$1.2 billion has been invested in SPDR Gold Trust ETF since start of banking crisis

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$1.2 billion has been invested in SPDR Gold Trust ETF since start of banking crisis

Since the start of the regional banking crisis in the United States, $1.2 billion has been flown into the SPDR Gold TrustETF GLD, a gold-backedETF that invests in physical metal bars and is managed by World Gold Trust Services, LLC.

The price of GLD went up to a one-year high on Monday, to as much as $183.84 per share. Each share of GLD is intended to mirror the price of a tenth of a troy ounce of gold. Gold prices reached a new low of $2,000 oz on Monday before retracing to $1,970 oz as of this writing.

On March 13, when $709 million entered theETF, funds began pouring into GLD as the banking sector was rocked by the collapse of Silicon Valley Bank, Silvergate Capital and Signature Bank. On March 17, GLD received a further sizable inflow of $400 million. The year-to-date flows into GLD have now turned positive by $579 million.

The banking crisis, expectations of lower Fed interest rates, no-default risk, and its traditional inflation-hedging role have piqued interest of investors, and the banking crisis has piqued interest from investors recently due to a combination of factors.

In the current market environment, gold is emerging as the ideal asset to have in a portfolio, and it recently outperformed bonds and equities.

GLD is up by 7% month-to-date compared to Invesco QQQ Trust's QQQ 4.4% gain, iShares Core US Treasury Bond ETF's GOVT 2.4% gain, SPDR S&P 500 ETF Trust's SPY flat performance and iShares Russell 2000 ETF's negative 6.7% return.

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The asset under management AUM of GLD has gone up by $4.19 billion over the last week, and has reached an overall $58 billion, after taking into account both the price effect of the rise in gold prices and the effect of fund flows.

GLD's AUM is still 16% below the peak of $70 billion reached in April 2022, and about 35% less than the peak of $84 billion reached in August 2020.

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