What is the PMGOLD ETF used for?
The Perth Mint PMGOLD ETF represents a right to gold created by The Perth Mint, Australia’s largest fully integrated precious metals enterprise. The ETF gives investors the ability to purchase Government-backed gold via the ASX, rather than holding physical bars themselves.
The PMGOLD ETF is designed to make life easy, allowing investors to gain exposure to physical gold via an ETF which can be bought and sold like shares. The PMGOLD ETF gives investors direct exposure to the underlying asset (gold bars) and returns depend on the international spot price of gold in Australian dollars, less fees and costs.
Keep an eye on FUM
The Perth Mint PMGOLD ETF had $645.25 million of money invested when we last pulled the monthly numbers. Given PMGOLD’s total funds under management (FUM) figure is over $100 million, the ETF has met our minimum criteria for the total amount of money invested, otherwise known as FUM. We draw the line at $100 million for ETFs in the Commodities sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
Fees and costs for investors
Perth Mint charges investors a yearly management fee of 0.15% for the PMGOLD ETF. This means that if you invested $2,000 in PMGOLD for a full year, you could expect to pay management fees of around $3.00.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.51% or around $10.20 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Summary
These are just some of the considerations or factors you would need to look at when weighing up the PMGOLD ETF. Before doing anything, take a look at our Perth Mint PMGOLD report – it’s free. While you’re at it, don’t forget to search our complete list of ASX ETFs.
