Gold Chasing Mounts

American stock investors’ gold-upleg-chasing gold-ETF-share buying is mounting.  After mostly ignoring gold’s powerful bull run for 6/7ths of its lifespan, they are increasingly returning.  These investors control vast pools of capital yet still have super-low gold portfolio allocations, which is a very-bullish omen.  Their long-awaited capital inflows ought to propel gold’s mighty cyclical bull much higher, with buying underway.

From early October 2023 to mid-June 2025, gold soared an epic 88.6% higher!  That wasn’t just one of gold’s biggest cyclical bulls on record, but a single monster upleg without any 10%+ corrections.  It was even more remarkable because gold’s usual dominant primary drivers largely didn’t fuel it.  Those are speculators’ hyper-leveraged gold-futures trading and American stock investors buying gold-ETF shares.

Gold’s previous 40%+ monster uplegs were overwhelmingly driven by huge differential gold-ETF-share buying.  Physically-backed gold ETFs’ mission is to track the price of their metal.  But their shares’ supply and demand are independent from gold’s own.  So if gold-ETF shares are bought or sold faster than gold itself, their share prices will quickly decouple from gold’s.  To avert that an equalization mechanism is needed.

The way it works is any outsized buying or selling of gold-ETF shares is shunted directly into the metal daily.  If gold-ETF share prices are rallying faster than gold, ETF managers issue sufficient new shares to absorb that differential demand.  The proceeds from those share sales are immediately used to buy more physical gold bullion to stack in the ETFs’ vaults.  Physically-backed gold ETFs are effectively conduits.

They enable huge capital to quickly and efficiently flow between stock markets and gold.  Rising gold-ETF bullion holdings reveal net inflows, which have been accelerating recently.  That means American stock investors’ gold chasing is mounting.  This is evident in the combined holdings of the three largest US gold ETFs, which are GLD SPDR Gold Shares, IAU iShares Gold Trust, and GLDM SPDR Gold MiniShares.

Every quarter the World Gold Council publishes the best-available global gold supply-and-demand data in its fantastic Gold Demand Trends reports.  That valuable and comprehensive data includes a ranking of the world’s top-ten physically-backed gold ETFs.  GLD and IAU have always dominated that list, exiting the latest-reported Q1’25 commanding fully 39.4% of all the gold bullion held by all the world’s gold ETFs!

In a distant third place is a UK gold ETF at just 6.2%.  GLD was the world’s first major gold ETF born way back in November 2004, proving an early success.  Ever since then, I’ve tracked and analyzed its holdings and their impact on gold prices.  While GLD was a great innovation vastly reducing friction and costs for shifting capital into gold, it charges an annual 0.4%-of-net-assets management fee for all that work.

Interestingly IAU just narrowly missed being the US first-mover, going live not long after GLD in January 2005.  But GLD was the first, was sponsored by the World Gold Council which is funded by gold miners, got tremendous publicity early on, and has a much-better symbol.  So for many years IAU was an also-ran, largely overlooked.  Yet fund managers eventually discovered IAU’s big competitive advantage over GLD.

IAU’s managers only charge 0.25% of net assets per year to run their physically-backed gold ETF and its underlying bullion movements.  While most retail investors couldn’t care less about 15 basis points per year, professional investors certainly do in their hyper-competitive industry.  Thus IAU inflows surged on big fund buying, sometimes outpacing GLD’s.  So in mid-September 2020, I integrated IAU into my GLD analyses.

Instead of just analyzing GLD holdings, since then it has been GLD+IAU holdings which offered a more-complete window into stock-market capital flows.  But a third American gold ETF has surged in popularity in today’s mighty cyclical bull.  Also sponsored by the WGC, GLDM is GLD’s little brother.  While GLD’s share price was initially based on 1/10th of an ounce of gold, GLDM’s was a fifth of that at 1/50th of an ounce.

When GLDM was launched in late June 2018, gold was trading around $1,250 per ounce.  A tenth of that less GLD’s cumulative annual management fees left it around $120 per share.  With GLDM coming out near 1/5th of that or $25 per share, that would make allocating capital into gold via ETFs more appealing and affordable for individual investors.  Research has shown $100+ share prices retard their demand.

But GLDM has an amazing ace up its sleeve that fund managers have increasingly discovered in recent years.  Its annual management fees are merely 0.1% of net assets, trouncing GLD’s 0.4% and IAU’s 0.25%!  So operating at whopping 75%-lower costs to investors, GLDM has effectively obsoleted GLD.  There’s no reason to deploy capital in GLD since GLDM exists and is being run by the same management as GLD.

Exiting Q1’25 which is again the latest-reported Gold Demand Trends data, GLDM was only the world’s sixth-largest gold ETF holding just 3.8% of all their physical gold bullion.  But what caught my attention when digesting that GDT report back in early May was GLDM’s phenomenal growth rate exceeding all of its top-ten peers.  In the year ending March 2025, GLDM’s holdings soared 34.5% tripling the world total!

All the world’s physically-backed gold ETFs’ holdings grew 10.7% in that span.  So in these past couple months I’ve been thinking about adding GLDM’s holdings to GLD+IAU’s.  I’ve done a bunch of research, discussed that in our subscription newsletters, and rebuilt our gold-ETF-holdings spreadsheets including GLDM.  I’m thinking GLDM could eventually eclipse GLD, and this is my first essay integrating GLD+IAU+GLDM.

Circling back a bit, American stock investors’ differential gold-ETF-share buying was sorely lacking for most of gold’s mighty cyclical bull.  From early October 2023 to mid-March 2025, gold’s monster upleg had blasted 63.8% higher.  Yet GLD and IAU holdings had only grown 4.4% and 2.5% during that span, or 38.2 and 10.1 metric tons.  Gold’s massive gains without American stock-market-capital inflows were astounding.

This is gold’s first 40%+ monster upleg since a pair both cresting in 2020, clocking in at 42.7% and 40.0% gains.  During the first GLD’s and IAU’s holdings soared 24.6% and 47.4% or 190.4t and 123.8t.  Then in the second emerging from the brutal COVID-lockdown stock panic, GLD’s and IAU’s holdings rocketed up 37.5% and 30.0% or 345.7t and 114.8t!  Monster gold uplegs needed big American-stock-investor buying.

Overall GLD+IAU+GLDM holdings skyrocketed 32.7% or 339.0t during that first upleg then another 36.4% or 484.9t during the second!  Yet from early October 2023 to mid-March 2025 in gold’s latest much-larger monster upleg, GLD+IAU+GLDM holdings merely climbed 5.6% or 76.4t.  And the main reason was the soaring popularity of GLDM, which enjoyed a way-outsized 29.4% or 28.0t build during that particular span.

Prior to last year, I would’ve thought a 40%+ gold upleg without big American differential gold-ETF-share buying was all but impossible.  Past gold uplegs couldn’t grow huge unless fueled by major inflows from American stock investors’ vast pools of capital.  But remarkably central banks and Chinese investors took the gold-buying baton from American stock investors in 2024.  The latter were distracted by the AI stock bubble.

As this chart shows, there were virtually no US-gold-ETF holdings builds in 2024 despite gold utterly soaring 27.2%.  GLD+IAU+GLDM holdings only edged up a trivial 0.1% or 1.2t last year!  And that was only because GLDM’s 14.3% or 13.7t build offset GLD’s 0.8% or 6.6t and IAU’s 1.5% or 5.9t draws.  It was shocking to see GLD+IAU+GLDM holdings actually fall to a deep 4.1-year secular low in early March 2024!

American stock investors mostly ignoring gold’s growing monster upleg was an extraordinary anomaly that couldn’t last.  In mid-February 2025 I explained why in an essay titled “Americans to Chase Gold”.  At that point GLD+IAU+GLDM holdings had been stalled for the better part of two quarters!  But sooner or later gold would rally high enough for long enough to start attracting interest from American stock investors.

As a herd they’ve never been buy-low contrarians looking for out-of-favor trades.  Their modus operandi is upside momentum chasing, loving to pile into well-established winners.  The higher and longer anything surges, the more American stock investors’ greed flares so the more they rush to buy in.  That’s true for market-darling AI stocks like NVIDIA, and gold.  That dynamic forms powerful virtuous circles of buying.

The more something rallies, the more investors want to chase it.  The more they buy, the higher it surges and the more bullish financial-media coverage is generated.  Both attract in widening flocks of investors, who allocate increasing amounts of capital further amplifying those gains.  That was bound to happen in gold at some point, and finally started in mid-March.  Look at GLD+IAU+GLDM’s sharp holdings surge since!

American stock investors have finally started chasing gold, which is really bullish.  Time-wise, 6/7ths of gold’s mighty cyclical bull happened from early October 2023 to mid-March 2025.  Again during that span, the total GLD+IAU+GLDM holdings build was merely 5.6% or 76.4t.  But from mid-March to mid-June in the latest 1/7th of this gold bull, GLD+IAU+GLDM holdings surged another very-similar 4.9% or 71.0t!

And GLDM has sure proven the belle of recent months’ ball, enjoying far-greater differential share buying than GLD and IAU.  From mid-March to mid-June, GLD’s, IAU’s, and GLDM’s holdings builds ran 3.8% or 34.7t, 3.7% or 15.5t, and 16.9% or 20.8t!  American stock investors are flocking back to gold ETFs, with GLDM leading the way.  It is fantastic GLDM is gaining traction with its best-in-breed 0.1% management fee.

I’ve long tracked holdings records in GLD and IAU.  GLD’s peaked at 1,353.3 metric tons way back in early December 2012, an eternity ago!  Midweek they were still running just 947.4t, or 30.0% lower.  But gold was only trading near $1,700 almost 13 years ago, so GLD’s record holdings were worth $74.1b.  Today they are worth $100.9b.  So gold investment is growing despite GLD’s holdings remaining way under peak levels.

IAU hit its record holdings high much later in early November 2020 at 531.0t.  It was during gold’s last pair of 40%+ monster uplegs cresting that year when institutional investors really shifted buying from GLD to IAU for its lower management fees.  Midweek IAU’s holdings are still 16.7% lower at 442.2t, but naturally worth much more with higher gold prices.  IAU’s gold bullion is worth $47.1b now compared to $31.9b then.

But upstart GLDM’s holdings are relentlessly climbing to new highs, sometimes multiple per week!  This Wednesday’s 149.0t read is GLDM’s highest-ever.  One of our gold-ETF-holdings spreadsheets uses conditional formatting to highlight new record highs, and GLDM’s column has been stuffed full of them in recent months.  It is great to see this low-fee gold ETF surge in popularity as investors start chasing gold.

And odds are this is only the beginning of their capital inflows, which ought to ultimately propel gold much higher.  Again gold’s total mighty cyclical bull and monster upleg so far clocks in with huge 88.6% gains over 20.3 months as of mid-June’s latest record!  The total GLD+IAU+GLDM build over that span is only 10.7% or 147.5t.  That’s really small considering gold’s epic gains and previous monster-upleg precedent.

Again gold’s prior two monster uplegs both peaked in 2020 averaging mere 41.4% gains, less than half today’s monster.  But GLD+IAU+GLDM holdings builds largely fueled those, averaging 34.5% or 412.0t!  There’s no reason why we shouldn’t see another 400t+ holdings build before today’s cyclical gold bull gives up its ghost.  I suspect it will prove much bigger since gold’s huge gains are much more chasable.

GLD+IAU+GLDM’s all-time holdings high was 1,861.9t in mid-October 2020.  Forging to new records from midweek levels would require another 21.0% or 323.3t build, which really isn’t a heavy lift.  It’s actually shocking how underinvested American stock investors are in gold today.  At Wednesday’s close, the total GLD+IAU+GLDM holdings were worth $163.9b.  That’s a big chunk of change, but tiny relative to investors’ capital.

The elite stocks of the flagship S&P 500 are the biggest and most-important US companies, dominating stock markets.  Their collective market capitalization midweek was a staggering $56,308.3b.  The current major-US-gold-ETF holdings are worth less than 0.3% of that!  This proxy for American stock investors’ capital allocations into gold implies they are still effectively zero.  They could easily double, triple, or more.

For centuries universal investment wisdom demanded at least a 5%-to-10% allocation in gold.  It is the ultimate portfolio-diversifying asset, tending to rally on balance when stock markets weaken.  While American stock investors will likely never get to 10% gold, they could certainly buy to 1%.  That means the value of their gold holdings would have to more than triple, requiring massive differential gold-ETF-share buying.

The longer and higher gold’s overarching secular bull runs, the more investors will want to chase it.  And that also remains modest by historical standards.  Gold’s current secular bull was born in mid-December 2015 at $1,051, and has powered 226.5% higher at best over this past decade or so.  Two legendary secular bulls in the 1970s clocked in with epic 418.6% and 731.7% gains, while a 2000s one crested at +292.7%!

Another inevitable market event that will really boost gold’s relative attractiveness is these record-high US stock markets rolling over.  Markets are forever-cyclical, all bulls are eventually followed by bears.  The latter are necessary because the former push stock valuations to unsustainable extremes, sometimes in bubble territory.  Over the last century-and-a-half or so, that starts at 28x earnings for US stock markets.

That’s double their historical fair value at 14x, implying reasonable and sustainable 7.1% annual growth.  Midweek those elite S&P 500 stocks averaged dangerous bubble-grade trailing-twelve-month price-to-earnings ratios of 31.1x!  A bear reckoning is long overdue for this euphoric AI stock bubble, and it will come since they always do.  That means US stock markets are facing 20% to 50% drops in coming years.

The latter serious-bear level is truly no exaggeration.  From March 2000 to October 2002, the S&P 500 plunged 49.1% over 30.5 months.  Then later from October 2007 to March 2009, the S&P 500 cratered a jaw-dropping 56.8% in 17.0 months!  Major bear markets after extreme bulls deep into bubble valuations are nothing to be trifled with.  They maul stock prices low enough for long enough for earnings to catch up.

The main reason American stock investors ignored gold’s mighty cyclical bull until mid-March 2025 was this AI stock bubble stole all the limelight.  Gold has always been an alternative investment, shining the brightest when stock markets are weakening.  With the mega-cap AI-market-darling stocks keeping on surging, investors felt little need to prudently diversify their tech-stock-heavy portfolios.  Bears change that!

Gold and related investments like silver and their miners’ stocks will become far more attractive when the US stock markets roll over into their next bear.  While the timing of that is impossible to predict, bull-bear cycles are inevitable and guaranteed.  The deeper the S&P 500’s next major selloff grows, the more gold will be sought after for larger portfolio allocations.  American stock investors still have vast room to buy it.

We’ve been capitalizing on gold’s mighty cyclical bull by trading fundamentally-superior mid-tier and junior gold stocks.  Our pair of subscription newsletters realized 84 mostly-gold-stock trades in 2024, averaging great annualized realized gains of +43.1%.  That crushed the leading GDX gold-stock ETF’s lagging 9.4% gain last year.  In 2025’s first half, we realized another 34 stock trades averaging +40.7% annualized gains.

Increasing capital inflows from American stock investors mean gold is going to continue powering higher on balance, which great gold stocks will amplify.  So in late June after a necessary high consolidation for gold, we started refilling our newsletter trading books.  The gold miners are also on the verge of reporting their best quarterly results ever by far over the next five weeks or so!  Their stocks’ upside potential is huge.

Successful trading demands always staying informed on markets, to understand opportunities as they arise.  We can help!  For decades we’ve published popular weekly and monthly newsletters focused on contrarian speculation and investment.  They draw on my vast experience, knowledge, wisdom, and ongoing research to explain what’s going on in the markets, why, and how to trade them with specific stocks.

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The bottom line is American stock investors’ gold chasing is mounting.  Major-gold-ETF holdings have surged dramatically in recent months, on growing differential gold-ETF-share buying.  That’s despite still-lofty US stock markets, and a stark inflection from the serious apathy saddling gold for most of its mighty cyclical bull.  American stock investors’ capital inflows into gold have concentrated in its lowest-cost ETF.

Yet even after that recent buying, their implied gold portfolio allocations to gold remain only a third of one percent.  That should be way higher, and will increasingly head that way as bubble-valued stock markets inevitably roll over into a long-overdue bear.  The combination of gold upside momentum and weakening stocks is a potent one for stoking big gold investment demand.  Gold stocks will be major beneficiaries of that.

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