FGDL vs IAU

FGDLBFranklin Responsibly Sourced Gold ETF

IAUBiShares Gold Trust

In short

FGDL Gold in a vault, with two twists: the bars come with Franklin's responsible-sourcing label, and the fund charges nothing to hold them. Assets are bullion and cash, full stop.

IAU Gold bars in a London vault, wrapped in a ticker since 2005. IAU is the veteran heavyweight of physical gold funds: bullion held by a custodian bank, priced off the London gold benchmark, tradable all day.

Stated mandate

FGDL The Fund seeks to track the price of gold bullion, after deducting expenses. Its assets consist only of gold bullion and cash, if any.

IAU The Trust seeks to reflect the price of gold bullion, after accounting for its expenses and liabilities. It provides exposure to physical gold.

Why people hold it

• FGDL A 0.00% expense ratio in a cohort whose median is 0.17%. Even the cheap giants charge something (GLDM 0.10%, IAUM 0.09%, GLD 0.40%).
• Simple plumbing: a grantor trust that holds gold bullion and cash and tracks the metal's price after expenses. No futures, no swaps, no miners.
• The responsible-sourcing standard is the pitch in a group where every fund owns the same metal, and Franklin spells it out in the trust's own filings.
• Does what it says: mandate, wrapper and holdings all line up, and it sits in the upper half of the physical gold cohort.

• IAU A twenty-year paper trail. Launched in 2005, with bullion held by JPMorgan Chase Bank's London branch and two decades of SEC filings anyone can read.sec.gov
• No futures, no swaps, no roll mechanics. Each share is a fractional undivided interest in gold the trust actually holds, marked to the LBMA gold price.sec.gov
• Costs less than the original US gold ETF: 0.25% a year against GLD's 0.40%. It's also one of the most actively traded funds in the physical gold group.
• Simple mandate, cleanly executed: the trust aims to reflect the gold price minus its expenses, and it has tracked that job about as closely as the structure allows.

Worth knowing

• FGDL Thinly traded next to the category's heavyweights, which can mean wider bid/ask spreads on the way in and out.
• Bullion pays no income, and the fund makes no distributions. The gold price, less costs, is the whole story.
• Launched in 2022 and far smaller than the decade-old gold trusts, so the track record is short by cohort standards.

• IAU Fees sit above the cohort median (0.25% vs 0.17%). iShares sells a micro version of the same exposure, IAUM, at 0.09%, and GLDM charges 0.10%.
• The trust earns no income, so it sells gold to pay the sponsor's fee. The gold behind each share declines over time, and shareholders get no distributions.sec.gov
• Tax wrinkle: gains on a trust holding gold are treated as collectibles gains, which can carry a higher top long-term rate than most stock gains.sec.gov

Full FGDL profile⁠

Full IAU profile⁠