Gold ETF Flows: May 2020

Gold ETF inflows through May outpace records for any calendar year in only 5 months


Revised: 12 June 2020. Please see note at the end of report for more details.

May highlights

Continuing their growth streak, gold-backed ETFs (gold ETFs) added 154 tonnes (t) – net inflows of US$8.5bn (+4.3%) across all regions in May, boosting global holdings to a new all-time high of 3,510t.1 Year-to-date inflows of US$33.7bn exceed the highest level of annual inflows of US$24bn seen in 2016.

Positive flows combined with a rising gold price also pushed assets under management (AUM) in gold ETFs to new record highs of US$195bn, even as stock and bond prices increased. Global gold ETFs had inflows in all but two trading days during April and May (41 of 43 days). The only other historical period with similarly consistent inflows occurred in May and June of 2016, when funds experienced inflows in all but four trading days.

North American-listed gold ETFs led regional inflows during May. Flows in the region are historically more correlated with gold’s price behaviour. The region’s funds led inflows for a second straight month, adding 102t (US$5.6bn, 5.6% AUM). North American funds now hold 1,815t of gold, surpassing the previous highs of 1,736t they held in December 2012. European funds added 45t (US$2.4bn, 2.9%), led by UK-based funds, which accounted for 65% of the total in the region. Asian funds – primarily in China – grew, adding 4.8t (US$262mn, 4.7%), and funds in other regions grew 4.3%, adding 2.6t and US$136mn.


ETF flows 1

ETF flows chart

Data as of

Sources: Bloomberg, Company Filings, ICE Benchmark Administration, World Gold Council; Disclaimer

Macroeconomic drivers

Stock markets rallied in May in nearly every major country. In the US, as one example, stocks were up by almost 40% from late March lows, the strongest two-month performance since 2009. Global stocks collectively were higher by 6% during the month. Despite this seemingly bullish environment for risk assets, various drivers propelled the gold price and gold ETF inflows including:

Lingering uncertainty

  • The economic and social impact of COVID-19, as most economies remain shut down or are slowly reopening.
  • Tensions between the US and China continue to escalate.
  • Labour markets are facing challenges not seen in generations. In the US, the unemployment rate is already at 14% and may soon reach levels last during the Great Depression of the 1930s.

Ongoing asset purchases by central banks

  • Monetary policy intervention is expanding into asset classes that would have seemed incredibly unlikely even a few months ago, such as high yield (junk) bond ETFs in the US. This has helped push bond yields even lower, reducing gold’s opportunity cost further and adding to market uncertainty as we are in unchartered waters.

As investors look to hedge the economic risks of ballooning budget deficits and high valuations for both stocks and bonds, collective holdings of gold ETFs have now surpassed Germany’s official gold reserves and exceed the official gold reserves of every country except for the US. This also highlights the increasing acceptance of gold ETFs among investors as a means to gain exposure to gold.

Price performance

Gold in US dollars was higher by 2.6% in May, finishing the month at US$1,728/oz. Gold volatility decreased significantly from the extreme levels in March, and 30-day realised volatility fell by nearly half from 29% in April to 15% in May. Implied volatility – or how much investors expected gold would move across tenors – remained somewhat elevated, signaling that investors expect meaningful moves in the gold prices in the near-term.

At the time of publication, gold has outperformed most major asset classes this year, up by more than 15%. Gold’s performance continues to distinguish itself from the wider commodity spectrum, as broader commodity indices are down 22% - 30% this year and oil (WTI) is down by more than 40%. Oil did see a significant jump in May, up over 70%, albeit off a very suppressed level, to finish back above US$30 a barrel.

Gold global trading volumes, picked up in May, rising from US$140bn in April to US$164bn during the month, as other asset class volumes experienced a sharp decline. Gold trading volumes are far below the y-t-d record of US$233bn a day in March, but above the 2019 daily average of US$145bn. COMEX net longs4, via the Commitment of Traders (COT) report, fell sharply to 789t, the lowest levels in one year, and below the all-time highs of 1,209t (US$63bn) experienced in February this year.

Looking forward

Many of the positive gold demand drivers remain, with a few additions:

  • The lower rate environment, driven by continued central bank activity, coupled with an uptick in inflation expectations
  • COVID uncertainty, both from an economic and social perspective, as well as the potential for a second wave of outbreaks
  • Future stock earnings expectations have fallen, driving valuations even higher. Our recent Investment Update: Gold, an efficient hedge notes a viable argument for using gold as a portfolio hedge
  • Race-related civil unrest in the US has recently emerged, creating additional uncertainty in markets

Regional flows2

North American fund holdings reached all-time highs in May

  • North American funds had inflows of 102t (US$5.6bn, 5.6% AUM)
  • Holdings in European funds increased by 45t (US$2.4bn, 2.9%)
  • Funds listed in Asia added 4.8t (US$262mn, 4.7%)
  • Other regions had inflows of 2.6t (US$136mn, 4.3%).

Individual flows

SPDR® Gold Shares and iShares Gold Trust represented 57% of all global inflows in May

  • In North America, SPDR® Gold Shares led global inflows, adding 67t (US$3.7bn, 6.4%), while iShares Gold Trust added 20t (US$1.1bn, 4.7%). Aberdeen Standard Physical Gold Shares led low-cost3 inflows adding 4.1t (US$225mn, 12.5%), followed by Graniteshares Gold and SPDR® Gold MiniShares which each added US$85mn.
  • Two UK-based funds led European-fund inflows: iShares Physical added 23.3t (US$1.3bn, 11.8%), Invesco Physical Gold added 6.9t (US$384mn, 3.5%).
  • In China, Huaan Yifu added 1.5t (US$83mn, 5.5%). Two new funds (ICBC Credit Suisse Gold and Frist Seafront Gold) were listed in China during the month. Their collective assets of 2.3t add 4% to China’s total gold ETF assets.

Long-term trends

Gold ETF assets have experienced the largest calendar-year asset growth in only 5 months

  • Over the past 12 months assets in global gold-backed ETFs have nearly doubled (+90%)
  • Following the May inflows, both holdings and assets of gold-backed ETFs continue to make all-time highs
  • UK-based gold funds continue to take regional and global market share, now representing 48% of European assets and 21% of global assets
  • Low-cost gold-backed ETFs in the US have doubled their collective holdings in the past year to 99t, which is roughly the size of all Asian-based funds3


  1. We regularly review the global gold-backed ETF universe and adjust the list of funds and holdings based on newly available data and information.

  2. We calculate gold-backed ETF flows both in ounces/tonnes of gold and in US dollars because these two metrics are relevant in understanding funds’ performance. The change in tonnes gives a direct measure of how holdings evolve, while the dollar value of flows is a finance industry standard that gives a perspective of how much investment reaches the funds. There are some months where the reported flows measured in tonnes of gold and their dollar-value equivalent seem inconsistent across regions. Both figures are correct. The disparity is due to the interaction between the performance of the gold price intra-month, the direction and movement of the US dollar and the timing of the flows. For example, hypothetically, if European funds were to experience outflows early in the month when the price of gold was low but gained assets later in the month when the price of gold increased, and/or if the euro/dollar currency rate moved meaningfully when there were flows, there might be a discrepancy between tonnage change and flows.

  3. Low-cost US-based gold-backed ETFs are defined as exchange traded open-ended funds listed in the US, backed by physical gold, with annual management fees of 20bps or less. At present, these include Aberdeen Physical Swiss Gold Shares, SPDR® Gold MiniShares, Graniteshares Gold Trust, and Perth Mint Physical Gold ETF.

  4. Net longs represent Money Manager and Other Net long positioning in the COMEX futures market.

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