Gold Miner ETFs That Pay Dividends

Investing in Gold ETFs offers a unique opportunity to gain exposure to the gold market without the need to purchase physical gold or individual gold stocks. In this article, we will explore several top-performing Gold ETFs that pay dividends, enabling investors to benefit from the potential of both gold price appreciation and regular income through dividends.

Understanding Dividend-Paying Gold Miner ETFs

Dividend-paying ETFs in the gold mining sector provide investors with an opportunity to participate in the gold industry’s growth while also receiving regular dividend distributions. These ETFs typically hold shares of various gold mining companies and distribute a portion of their earnings to shareholders in the form of dividends. Dividends are a portion of a company’s profits that are distributed to shareholders. By investing in dividend-paying gold miner ETFs, you become a partial owner of multiple gold mining companies and can benefit from their success.

The advantages of investing in dividend-paying gold miner ETFs include the potential for stable income and the possibility of long-term capital appreciation. However, it’s essential to consider that these ETFs may have higher expense ratios than non-dividend-paying counterparts, and dividend yields can fluctuate based on market conditions.

Top Dividend-Paying Gold Miner ETFs

Sprott Gold Miners ETF (SGDM)

The Sprott Gold Miners ETF (SGDM) was introduced in 2014, providing investors with access to a diversified portfolio of 33 gold and silver mining companies. With a market capitalization of nearly $269 million, this ETF strategically mirrors the performance of the Solactive Gold Miners Custom Factors Index TR, which includes 32 precious metals companies. SGDM’s annual operating expenses are 0.52%, with 0.02% waived by the investment advisor, resulting in a net fund fee of 0.50%. The ETF boasts a dividend yield of 1.22% and has consistently paid dividends since 2018, distributing $0.36 per share to investors on Dec. 22, 2021.

iShares MSCI Global Gold Miners ETF (RING)

Introduced by BlackRock in 2012, the iShares MSCI Global Gold Miners ETF (RING) boasts $577 million in net assets, providing exposure to companies involved in gold mining across developed and emerging markets. The portfolio comprises 38 companies, with the top three holdings being Newmont, Barrick Gold, and Agnico Eagle Mines Ltd, making up approximately half of the ETF’s portfolio. RING offers a dividend yield of 2.08% and carries a low expense ratio of 0.39%. The fund awards semi-annual distributions, with a recent $0.33 distribution per share on Dec. 17, 2021, following a $0.31 distribution on June 16, 2021.

VanEck Vectors Junior Gold Miners ETF (GDXJ)

Also launched by Van Eck in 2009, the VanEck Vectors Junior Gold Miners ETF (GDXJ) complements the larger GDX ETF by focusing on gold mining firms with lower market cap values. The ETF tracks the Market Vectors Global Junior Gold Miners Index, reflecting the performance of small- and mid-cap companies primarily deriving their revenue from gold and silver mining. GDXJ boasts 100 holdings, with the largest position representing less than 6% of the total portfolio’s value. The fund’s concentration is more diversified, with the top 10 holdings accounting for less than 40% of the portfolio’s assets. With an expense ratio of 0.52% and a dividend yield of 1.76%, GDXJ issued its last dividend of $0.7454 per share on Dec. 27, 2021, having distributed dividends in 11 of the 13 years since its inception.

VanEck Vectors Gold Miners ETF (GDX)

Launched by Van Eck in 2006, the VanEck Vectors Gold Miners ETF (GDX) is a dominant player in the Gold ETF space, with a massive $14.3 billion in net assets. The ETF trades on the NYSE Arca Exchange and features a diversified portfolio of 56 holdings, including some of the world’s largest gold companies like Newmont, Barrick Gold, and Franco-Nevada. GDX tracks the NYSE Arca Gold Miners Index and carries an expense ratio of 0.52%. With a dividend yield of 1.15%, GDX pays distributions annually, issuing its most recent dividend of $0.5348 per share on Dec. 27, 2021, except for 2008.

Criteria for Selecting the Top Gold Miner ETFs

When selecting dividend-paying gold miner ETFs, several key metrics and factors should be considered. These include the ETF’s dividend yield, which represents the annual dividend payments as a percentage of the ETF’s share price. Expert insights suggest that a stable and growing dividend history is an essential factor, indicating the ETF’s ability to generate consistent income for investors. Balancing dividend yield with fund expenses and historical performance is crucial to assess the overall potential of an ETF as an income-generating investment.

The Bottom Line

Investors looking to explore the potential of the gold market and seek regular income should consider dividend-paying Gold ETFs as a compelling investment option. Each of the mentioned ETFs offers a unique set of benefits, from diversification across gold mining companies to competitive dividend yields. Furthermore, dividend-paying Gold ETFs can serve as a valuable addition to a well-balanced portfolio, providing a hedge against economic uncertainties and inflation. With their ability to combine the benefits of gold exposure and regular income, these ETFs offer a practical solution for investors seeking stability and growth potential in the ever-changing financial landscape.

As always, it’s essential to conduct thorough research, assess risk tolerance, and align investment choices with individual financial goals to make informed decisions that suit your investment strategy. Embrace the potential of dividend-paying Gold ETFs to capitalize on the precious metal’s allure and income-generating capabilities while striving towards long-term financial success.

FAQs

Q : Are dividend-paying gold miner ETFs a safe investment?

A : Dividend-paying gold miner ETFs can be considered relatively safer investments compared to individual stocks, as they offer diversification across multiple companies.

Q : Does Vanguard Have a Gold ETF?

A : No, Vanguard does not currently offer a gold mining ETF.

Q : How often are dividends paid in these ETFs?

A : Dividend payments vary among ETFs and are typically distributed quarterly, semi-annually, or annually. Investors should check the specific ETF’s dividend distribution schedule.

Tim Schmidt

About 

Tim Schmidt is an Entrepreneur who has covered retirement investing since 2012. He started IRA Investing to share his expertise in using his Self-Directed IRA for alternative investments. His views on retirement investing have been highlighted in USA Today, Business Insider, Tech Times, and more. He invested with Goldco.