IAU — iShares Gold Trust
IAU is iShares' physically backed gold ETF, launched in 2005 as a lower-cost and smaller-share-size alternative to GLD. Each share represents approximately 0.01 ounces of gold, making it highly accessible for retail investors with small accounts. At 0.25%, IAU is more expensive than GLDM but cheaper than GLD. It accumulated massive retail investor assets making it one of the largest gold ETFs globally, second only to GLD.
Top Holdings
Strategy
- →Use as a retail-friendly gold holding combining reasonable cost with deep iShares liquidity
- →Allocate 5–10% as a portfolio diversifier and inflation/crisis hedge
- →Hold long-term in IRAs or taxable accounts as a permanent portfolio gold allocation
- →Pair with silver (SLV) for a broader precious metals allocation
Best For
- ✓Retail investors who want a well-known, liquid, iShares gold ETF at moderate cost
- ✓IRA investors who want physical gold exposure in a tax-advantaged account
- ✓Those seeking a middle ground between GLDM's cheapest cost and GLD's deepest liquidity
- ✓Long-term gold holders who value iShares brand reliability
Key Risks
- ⚠0.25% expense ratio is more expensive than GLDM (0.10%) — meaningful for long-term holders
- ⚠No income — pure gold price exposure only
- ⚠Gold price volatility — can fall 20–30% during rising real rate environments
- ⚠Collectibles tax treatment may apply in the US
Similar ETFs
Frequently Asked Questions
Is IAU the same as GLD?
Both track the gold spot price with physical gold backing, but IAU charges 0.25% vs. GLD's 0.40%, and each IAU share represents a smaller fraction of an ounce. IAU has historically attracted more retail investors; GLD has more institutional and trader usage. This is educational content, not financial advice.
Why should I consider GLDM over IAU?
GLDM charges only 0.10% versus IAU's 0.25%. For long-term buy-and-hold investors, GLDM's lower fee compounds to meaningful savings over decades. If maximum iShares brand trust matters, IAU may still be preferred. This is educational content, not financial advice.
Does IAU hold physical gold?
Yes. IAU holds allocated physical gold bars in vaults managed by JPMorgan Chase in New York, London, and Toronto. Holdings are inspected and audited. This is educational content, not financial advice.
Can I redeem IAU shares for physical gold?
Standard retail investors cannot easily redeem IAU shares for physical gold — this is only available to authorized participants at specific basket sizes. Most investors buy and sell IAU on the exchange. This is educational content, not financial advice.
How does gold exposure in IAU affect portfolio risk?
Gold historically has low or negative correlation to equities during crises, potentially reducing portfolio drawdowns. A 5–10% gold allocation has historically improved risk-adjusted returns in diversified portfolios. This is educational content, not financial advice.
Recommended Resources
Tools & books I actually use and recommend
Interactive Brokers
Low commissions, global market access, and professional-grade tools. This is where I hold my positions.
Open an AccountA Random Walk Down Wall Street
Burton Malkiel's classic case for index investing. The book that convinced millions to stop stock-picking.
View on AmazonTradingView
Best charting platform out there. Real-time data, screeners, and a community of millions of traders.
Try TradingViewSome links above are affiliate links. I only recommend products I personally use. See my full disclosures.