Commodities & Metals

Global Gold ETF Outflows Totaled $30 Billion in the First Half of 2021

Since posting a high of around $2,100 an ounce on August 6 of last year, gold futures have dropped by about $350 an ounce (16.2%) as of Wednesday. Futures traded about flat Thursday morning at $1,877.90 an ounce. For the year to date, gold futures have fallen about 7.8%.

The World Gold Council (WGC) released its midyear outlook Thursday morning, and after a few remarks warning of inflation, currency debasement and shifting asset allocation strategies, had this to say about the prospects for gold in the second half of 2021: “Combined with attractive entry levels, this could prompt strategic investors to add gold to portfolios as well as support central bank buying in H2.”

Higher interest rates in the first quarter of the year and in late June drove gold’s poor performance in the first six months of the year. Rising interest rates make bonds more attractive to investors, but worries of rising inflation actually moderated the drop in gold prices.

In a separate report on the flow of funds into gold exchange-traded funds (ETFs), the WGC reported that $30.7 billion flowed out of global gold ETFs in the first half of the year. Inflows of $23.9 billion resulted in a net outflow of $6.8 billion or 3% of total assets under management (AUM).

Outflows from North American gold ETFs totaled nearly $7 billion, while European ETFs saw a drop of $767 million. These losses were partially offset by $954.2 million in Asian gold ETFs.

Three of the top five performing ETFs for the first half of the year were based in Germany, one was based in France, and the fifth, the SPDR Gold MiniShares Trust (GLDM), is based in the United States. Only one other U.S.-based ETF, the Sprott Physical Gold Trust (PHYS), made the top 10 list. Inflows to GLDM totaled $604.6 million (15.1% of AUM) and inflows to PHYS totaled $157 million (3.2% of AUM). The ETF enjoying the highest inflow was Stuttgart-traded Xtrackers IE Physical Gold ETC, with a total inflow of $1.65 billion (610.4% of AUM) in the first half of the year.

Among the 10 ETFs with the greatest outflows, two of the top three are based in the United States: the SPDR Gold Shares (GLD) and the iShares Gold Trust (IAU). A total of $6.86 billion (9.6% of total AUM) flowed out of GLD and $1.04 billion (3.3% of AUM) flowed out of IAU.

Top 10 2021 Year-to-Date ETF Inflows

ETF Country Holdings (tonnes) Flows (tonnes) Flows (US$mn) Flows (%AUM)
Xtrackers IE Physical Gold ETC Germany 33.2 28.7 1,649.4 610.4
Xetra-Gold Germany 233.1 16.2 948.2 7.2
Xtrackers IE Physical Gold EUR Hedged ETC Germany 15.4 13.1 765.0 476.4
Amundi Physical Gold ETC France 64.2 10.2 620.6 18.9
SPDR Gold MiniShares Trust U.S. 76.3 10.3 604.6 15.1
CI Gold Bullion Fund Canada 7.2 7.2 417.8 NA
EUWAX Gold II Germany 14.8 4.2 243.0 38.0
Bosera Gold Exchange Trade Open-End Fund ETF China P.R. Mainland 22.6 3.6 193.3 16.9
Huaan Yifu Gold ETF China P.R. Mainland 29.5 3.4 189.0 12.1
Sprott Physical Gold Trust U.S. 83.2 2.7 157.0 3.2

Bottom 10 2021 Year-to-Date ETF Inflows

ETF Country Holdings (tonnes) Flows (tonnes) Flows (US$mn) Flows (%AUM)
SPDR Gold Shares U.S. 1,045.4 −124.9 −6864.8 −9.6
Xtrackers Physical Gold ETC EUR Germany 41.6 −22.6 −1,299.3 −33.2
iShares Gold Trust U.S. 504.7 −19.6 −1,043.4 −3.3
Xtrackers Physical Gold Euro Hedged ETC Germany 39.5 −16.5 −949.6 −27.0
WisdomTree Physical Gold U.K. 107.8 −13.2 −750.5 −10.2
Gold Bullion Securities Ltd U.K. 65.1 −10.8 −616.2 −13.3
Xtrackers Physical Gold ETC Germany 9.0 −9.5 −545.5 −48.3
Invesco Physical Gold ETC U.K. 219.9 −10.2 −535.3 −3.8
iShares Physical Gold ETC U.K. 227.1 −7.7 −404.9 −2.8
ZKB Gold ETF Switzerland 168.8 −3.1 −172.3 −1.6

For more details and the WGC methodology, see the second-quarter report.