Unlike silver, there are a few Gold ETFs available for investors. There’s streetTRACKS Gold Shares [[GLD]], or Market Vectors Gold Miners ETF [[GDX]]. The main difference for both of these funds is the difference between what the fund focuses on holding. For streetTRACKS Gold Shares (GLD) the focus is physical gold, while the Gold Miners ETF (GDX) fund focuses on gold mining company stock. It’s the difference between holding paper and holding the real thing.

First for those new to ETFs, an Exchange Traded Fund (ETF) is a pretty nifty investment vehicle. Much like a mutual fund, an ETF allows many investors to pool investment funds and buy shares in a professionally managed investment fund. What makes an ETF even more attractive is that shares of an ETF trade exactly like a stock: they can be bought, sold and shorted almost instantaneously. In addition to trading exactly like stock, some ETFs even have options available.

Moreover taxation on ETFs are more favorable than with traditional mutual funds. Most ETFs specialize in particular groupings of companies and industries that have certain common characteristics. Moreover, expenses for ETFs are low and range between .1% to 2%. The low expenses coupled with the specialization makes ETFs an incredible opportunity for investors.

Now for details on the difference between these Gold ETFs. Prudent investors balance the returns and risks by owning both ETFs. Yes, prudent investors would own both gold ETFs to balance the gains from the inflationary hedge, Gold Shares (GLD), and use the leverage available by owning gold miners using the Gold Miners ETF (GDX).