Gold ETF: how it works and options for investing
Updated 31 July 2026
A gold ETF is in fact an ETC, a listed security that tracks the price of gold without physically holding the metal. This guide sets out how it works, its different forms, its fees, its taxation and its limits, then compares it with physical gold.
- The four largest physical gold ETCs listed in Europe charge management fees of 0.12% to 0.15% a year.
- Because gold is not a European share, a gold ETC cannot be held in a PEA (Plan d'Épargne en Actions, France's equity savings plan).
- A physically replicated ETC is backed by gold allocated in a vault; a synthetic ETC exposes you to the issuer's counterparty risk.
- On resale, the gain on a gold ETC is subject to the flat tax of 31.4% in 2026, unless you opt for the progressive income tax scale.
- Physical gold falls under a separate regime: a flat levy of 11.5% of the sale price, with no exemption threshold.
What is a gold ETF?
A gold ETF is a listed product that tracks the price of an ounce of gold. Technically it is not an ETF but an ETC (Exchange Traded Commodity), a security backed by gold rather than a fund holding shares.
An ETF (Exchange Traded Fund) is an index fund tied to a listed asset, designed to replicate a benchmark index. It therefore lets you invest in all the companies that make up that index in a single order, for example every company in the CAC 40 for a CAC 40 ETF.
A gold ETF is not really an ETF but an ETC (Exchange Traded Commodity). That means its purpose is to track the price of commodities listed on the market. A gold ETF therefore aims to replicate the price of physical gold as faithfully as possible. The same is true of a commodities ETF.
The main advantage of a gold tracker lies in its passive, and therefore inexpensive, management. Management fees on gold ETCs listed in Europe range from 0% to 0.99% a year, and the four largest by assets sit between 0.12% and 0.15% (justETF, as at 30 July 2026).
Good to know : Pay attention to how your gold ETF replicates its underlying. The aim here is not to lose money, so read up on the difference between synthetic and physical replication. Physically replicated ETCs hold a stock of physical gold as collateral. How does a gold ETF work?
A gold ETF works like a listed security issued by an asset manager: its value follows the gold price, but you never hold the metal directly.
In theory, when you buy a tracker, you own the ETF, which in turn owns the underlying, whether that is shares or bonds. Indirectly, you therefore own a "piece" of every company invested in. A gold ETF does not work that way.
You do not hold physical gold directly: you buy a listed security (an ETC, that is to say a debt security) issued by an asset manager. The essential nuance lies in the replication method. A physically replicated ETC, which is the case for the main gold trackers, is backed by allocated gold: bars genuinely held in a vault on behalf of holders, verifiable through the bar list published and audited by the issuer. A synthetic ETC, by contrast, holds no gold but a promise of payment from a counterparty, which exposes you to that counterparty's risk of default. It is this distinction that determines your real level of risk.
Good to know : While a gold ETF looks like a simple, fast way to invest in gold, how it works is more complex than it appears. To gauge the risk level of a gold ETF, you can look at the actual stock held by the fund. That stock is what serves as collateral for investors, and it is also referred to as "Gold Backed". What are the different types of gold ETF?
A gold ETF gives you access to two markets:
- the physical price of gold;
- the share prices of companies in the gold industry (mines, gold extraction or processing companies, and so on).
To make this clearer, here is a table setting out, by way of example, several physical gold ETCs available on the market. You can use a similar table to compare trackers and rank them according to your risk profile.
Good to know : Pay attention to what gold ETFs actually hold. Some trackers labelled "Or" or "Gold" in fact track the share prices of gold miners and other companies that derive their revenue from gold and its derivatives, and some are precious metals ETFs. One last point to bear in mind: gold is priced in US dollars. Even if you buy an ETC denominated in euros, its value also depends on the EUR/USD exchange rate. A rise in the gold price can be partly wiped out by a fall in the dollar, and vice versa. To neutralise that effect, some issuers offer currency-hedged share classes (labelled "EUR Hedged"), at a slight additional hedging cost.
Is it better to buy a gold ETF or physical gold?
So, paper gold or physical gold? It all depends on your objective. Depending on your wealth management strategy, each has its advantages. The important thing to keep in mind is that a gold ETF is very much a stock market investment product, not a product for protecting your wealth. To separate these two ways of buying, let us look at three things: fees, storage and the security of your investment.
Management fees
At first glance, buying physical gold generates no management fees once you have bought your bar or your ounces of gold. There are, however, storage costs, and they can be high. Depending on the method of safekeeping you choose, in a bank vault, in a private company's vault, or in your garden, that can amount to several hundred euros a year, with guarantees that vary widely from one provider to another.
A gold ETF has one major advantage: its low management fees. At the four largest physical gold ETCs listed in Europe, they run between 0.12% and 0.15% a year (justETF, as at 30 July 2026). That may appeal to a passive investor looking to keep costs down.
On this criterion, a gold ETF may have an advantage in terms of direct fees.
Storage
Gold means physical matter, which means storage. As well as taking up space, storage has a cost, unless you bury it in your garden or keep it under your mattress. On this point, a gold ETF has nothing but advantages: it requires no storage space at all. Do watch which wrapper you choose, though: because gold is not treated as a European share, it is not PEA-eligible. To bring it into your portfolio, you can turn to the ordinary securities account (CTO), the simplest option, or to life insurance, provided your policy offers that option among its unit-linked funds.
Whichever wrapper you go for, apps such as Finary let you bring the monitoring of your positions together across all brokers and wrappers.
within your reach
Non-contractual document for promotional purposes. Investment in unit-linked vehicles carries a risk of capital loss, since their value is subject to fluctuation, both upwards and downwards, depending in particular on developments in the financial markets. The insurer guarantees the number of unit-linked vehicles and not their value, which it does not guarantee. The e-vie life insurance policy is an individual life insurance policy, denominated in euros and/or unit-linked vehicles, underwritten by Generali Vie, a company governed by the French Insurance Code. Finary SAS, 58 rue de Monceau 75380 Paris 8, an investment firm authorised by the ACPR under no. 19283, member of AMAFI. Insurance broker registered with ORIAS under no. 21001279, member of the CNCGP (association approved by the AMF). Crypto-Asset Service Provider (CASP) authorised by the AMF under the MiCA regime, references no. A2026-026 and no. N2026-008.
On this criterion, a gold ETF has the advantage of requiring no physical storage and no insurance.
Security
As a safe-haven asset, gold often represents security for investors. This precious metal is itself volatile, but it often moves independently of equity markets, which makes it a tool for diversifying a portfolio rather than a low-risk asset.
The real risk does not lie in an insufficient stock of gold: for a physically replicated ETC, the allocated gold is segregated and remains the property of holders, even if the issuer fails. Vigilance applies to two other things: synthetic ETCs, where you depend on a counterparty's solvency, and the gold price itself, which can fall for long stretches.
When you buy a gold bar, by contrast, you own it physically. You hold the bar physically, subject to the risks of storage, theft and authentication. Only its value will vary with the price. There is a reason it is called a safe-haven asset.
On this criterion, physical gold has the particular feature of being held directly.
Good to know : Gold ETFs are an interesting stock market product, but they do not allow you to protect your wealth. An allocation to gold should be considered in light of your personal situation; an authorised adviser can help you. Physical gold and paper gold answer different logics when it comes to ownership and liquidity. Some investors are also interested in bitcoin. Crypto-assets are highly volatile and speculative assets carrying a risk of total capital loss (MiCA framework). How is a gold ETF taxed?
Taxation depends on the wrapper. A gold ETF (ETC) is held in an ordinary securities account: it is not PEA-eligible. On resale, the gain is subject to the flat tax (PFU) of 31.4% in 2026 (12.8% income tax and 18.6% social levies), unless you opt for the progressive income tax scale.
Physical gold (bars, investment coins) falls under a separate regime. On sale, you owe the flat levy on precious metals of 11%, to which the CRDS of 0.5% is added, making 11.5% of the sale price, whatever the size of the transaction. The €5,000 exemption threshold that is often quoted applies only to jewellery and to items of art, collection or antiquity: the BOFiP states that "these provisions do not apply to sales or exports of precious metals". You may, however, on production of evidence of the purchase date and price, opt for the capital gains regime on movable property: an allowance of 5% a year applies from the third year of ownership, giving full exemption after 22 years.
Frequently asked questions
Which ETF for gold?
There are many gold ETFs, but those that genuinely track the gold price are rarer. Among them you will find:
- iShares Physical Gold (IE00B4ND3602)
- Invesco Physical Gold (IE00B579F325)
- Amundi Physical Gold ETC (FR0013416716)
- WisdomTree Physical Swiss Gold (JE00B588CD74)
The main trackers following gold miners, or companies that derive their revenue from the gold industry, and available to a French investor, are the following:
- VanEck Gold Miners UCITS ETF (IE00BQQP9F84);
- iShares Gold Producers UCITS ETF (IE00B6R52036);
- Amundi Gold Miners UCITS ETF (LU2611731824).
Can you hold gold in a PEA?
The PEA (Plan d'Épargne en Actions) is restricted to European shares and eligible funds. It cannot hold a gold ETF, a gold certificate or a commodities ETF, none of which meet those criteria. In practice, you therefore cannot invest in gold through a PEA: to gain exposure to the metal you have to go through an ordinary securities account.
How do you buy gold on the stock market?
You have several ways to buy gold on the stock market: a gold ETF, a gold certificate, or shares in gold mining companies. In every case this is paper gold, so you need to be very careful about the quality of the company issuing your product in order to protect yourself in the event of economic turbulence.
Does a gold ETF carry a risk of capital loss?
Yes. The gold price can fall, and a synthetically replicated ETC exposes you to the issuer's counterparty risk. Even a physically replicated ETC remains a stock market product subject to market swings: it does not guarantee the protection of your wealth.
Sources
AMF: ETFs (trackers), features and risks
impots.gouv.fr: taxation of capital gains on securities, flat tax of 31.4%
impots.gouv.fr: flat levy on sales of precious metals, form 2091-SD
BOFiP: flat levy on precious objects, scope and exclusion of precious metals
justETF: comparison of gold ETCs listed in Europe, assets and management fees
