IAU and SGDM Both Soar Off Of Gold’s Record-Breaking Numbers
Key Points
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The Sprott Gold Miners ETF has nearly doubled the return of the iShares Gold Trust over the past year, but it also has double the expense costs.
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SGDM holds a concentrated basket of gold mining stocks, while IAU directly tracks the price of physical gold.
Both the Sprott Gold Miners ETF (NYSEMKT:SGDM)and iShares Gold Trust (NYSEMKT:IAU) offer exposure to gold, but their strategies and risk profiles diverge sharply. This comparison unpacks their cost, performance, risk, portfolio makeup, and trading characteristics to help investors decide which may better fit their objectives.
Snapshot (cost & size)
| Metric | SGDM | IAU |
|---|---|---|
| Issuer | Sprott | IShares |
| Expense ratio | 0.50% | 0.25% |
| 1-yr return (as of Feb. 7, 2026) | 137.07% | 72.60% |
| Beta | 0.53 | 0.14 |
| AUM | $718.12 million | $78 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.
IAU is more affordable with a 0.25% expense ratio compared to SGDM’s 0.50%, but its return over the last 12 months is substantially lower.
Performance & risk comparison
| Metric | SGDM | IAU |
|---|---|---|
| Max drawdown (5 y) | -45.05% | N/A |
| Growth of $1,000 over 5 years | $2,735 | $2,690 |
What’s inside
The iShares Gold Trust is designed to track the spot price of gold, offering direct exposure to physical bullion. With $78 billion in assets under management and a 21-year history, it serves as a highly liquid, low-cost vehicle for those seeking pure gold price exposure.
The Sprott Gold Miners ETF has a concentrated portfolio of 43 gold mining companies. Its top holdings include North American companies such as Agnico Eagle Mines Ltd. (TSX:AEM.TO), Newmont Corp.(NYSE:NEM), and Wheaton Precious Metals Corp. (TSX:WPM.TO). Companies with higher revenue growth and lower debt-to-equity (D/E) ratios are given more weight within the portfolio.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
When investing in ETFs tied to the performance of precious metals, be aware of the heightened volatility that can come with it compared to common stock-based ETFs. Precious metals can be very volatile, especially during times of economic and geopolitical turbulence.
Given that gold is one of the most traded precious metals in the world, its price can fluctuate sharply. As of now, that has benefited investors, as the metal is benefiting from international entities increasingly purchasing it for their reserves, while the U.S. dollar has also weakened. But investors should still be mindful that sudden drops can occur.
Choosing between these two ETFs yields similar results, as both are tied to the performance of gold. SGDM has had better one-year performance, but when looking at price returns over a five-year span, they’re nearly identical. However, if some investors don’t feel comfortable with an ETF that only holds gold, then SGDM may be more suitable.
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Adé Hennis has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
