The 2025 gold rush is in effect as the price of bullion climbs to new heights and capital flows quickly into gold-focused exchange-traded funds (ETFs). One easy way to participate in gold fever is to own shares of the Sprott Gold Miners ETF (NYSEARCA:SGDM).
The spot gold price could hit $5,000 this year, and you’ll surely be disappointed if you missed out on the opportunity. However, you might not want to bother with shipping, storing, and insuring gold bars or coins. Furthermore, certain types of investment accounts don’t directly allow gold bullion investments.
That’s fine since there’s a near-perfect workaround with the Sprott Gold Miners ETF. There’s no need to hold physical gold, and many investment accounts will allow you to buy and sell an ETF such as SGDM. As long as you understand the risks involved, you can use this fund to get immediate exposure to the powerful rally in gold.
When Gold Gains, So Do the Miners
Gold is up 50% year to date, and the spot price of gold is approaching $4,000. The yellow metal has notched new all-time highs multiple times in 2025, and all of a sudden, financial traders on social media are buzzing about gold.
It’s difficult to pinpoint just one reason why the gold price keeps rising. The most evident contributing factor is the comparative decline in the value of the U.S. dollar, against which we’re measuring the gold price.
Another factor would be uncertainty about the American economy and about international conflicts. It’s not always a perfect one-to-one correlation, but the gold price tends to rise during non-recessionary times of uncertainty.
To benefit financially from these gold-positive factors, you could simply own an ETF that tracks the spot gold price. That’s fine, but while gold gained 50% in 2025 so far, the Sprott Gold Miners ETF has more than doubled in price during that time.
This makes sense because the mining companies’ bottom lines will certainly benefit from a rising gold price. Generally speaking, a gold-mining fund like the Sprott Gold Miners ETF can magnify the moves of the gold price; that’s good news if gold’s on the rise and you already bought shares of SGDM.
Exposure to the Big Names
With the Sprott Gold Miners ETF, you don’t need to conduct deep research and pick out the top gold miners. The fund’s managers will do the heavy lifting on your behalf so you can just buy SGDM shares and leave them in your portfolio.
As of October 3, 2025, the Sprott Gold Miners ETF’s holdings list included 37 larger-sized companies that mine gold and possibly other minerals. These companies are known as gold majors, as opposed to the smaller businesses known as gold minors.
A few of the top holdings in the Sprott Gold Miners ETF are the stocks of Agnico Eagle Mines (NYSE:AEM), Newmont (NYSE:NEM), Kinross Gold (NYSE:KGC) and Barrick Mining (NYSE:B). The vast majority of miners in the SGDM holdings list are based in North America.
Bad News, Good News
Bear in mind, there’s a price to be paid for allowing the fund’s management to do the research and stock picking. Specifically, the Sprott Gold Miners ETF automatically deducts 0.5% worth of operating expenses per year from the share price.
That’s not extremely cheap but also not overly expensive in the universe of ETFs. Besides, the Sprott Gold Miners ETF pays out dividends/distributions and these could offset the fund’s operating expenses.
This is good news for folks who like to collect dividend payments, which you wouldn’t get if you only owned physical gold bullion. Historically, the Sprott Gold Miners ETF has had a pattern of paying a cash distribution toward the end of each calendar year.
This makes it difficult to estimate the forward annual distribution yield of the Sprott Gold Miners ETF, since we can’t easily predict the fund’s cash payout or its share price at the end of 2025. We can observe, however, that the SGDM ETF paid a $0.29-per-share distribution in December of 2024. It’s certainly possible, then, that the fund’s 2025 distribution could exceed the operating expenses on a percentage basis.
Mitigating the Volatility Risk
If the U.S. dollar’s relative value continues to decline and/or the market’s sense of uncertainty persists, the gold price could reach $5,000 or even higher than that. This scenario, if it plays out, would very likely prompt a huge follow-through rally for the Sprott Gold Miners ETF.
Still, there’s no guarantee that this will actually happen during 2025’s final three months. Mining companies’ revenues tend to fluctuate, and so do the share prices of their stocks.
In other words, there’s volatility risk associated with the fast-moving Sprott Gold Miners ETF. Therefore, it’s wise to implement some de-risking measures.
Rule number one would be to keep your share position size small. That way, your portfolio won’t suffer too much if the SGDM share price falls quickly.
Also, you can have an exit strategy in case the price of the Sprott Gold Miners ETF declines too much for you to tolerate. You might choose to set a stop-loss in which you’ll agree to sell some or all of your SGDM shares if the price drops to a predetermined level.
Additionally, it’s a good idea to keep track of the spot gold price as well as the share price of the Sprott Gold Miners ETF. You don’t have to be as gold-market-savvy as the fund’s managers, but a basic overall awareness will you a more informed, and possibly more profitable, investor in the SGDM ETF.
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