##  [# ETF Investors Dumped $13 Billion in Gold This Year](/sections/news/etf-investors-dumped-13-billion-gold-year) 

 

# ETF Investors Dumped $13 Billion in Gold This Year

 

 

High Treasury yields cut the lure of the precious metal.



 

 

 

 

 [![GabeAlpert310x310](/sites/default/files/styles/author_image_icon/public/2023-08/GabeAlpert310x310.png?itok=LtV5mb0-)](/authors/gabe-alpert) 

[By Gabe Alpert](/authors/gabe-alpert)

 Nov 24, 2023

 Edited by: Ron Day

 

 

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Investors pulled a whopping $12.7 billion from exchange-traded funds holding physical [gold](https://www.etf.com/topics/gold) through the end of October this year, as sky-high interest rates made the precious metal less alluring, according to a [report](https://www.gold.org/goldhub/research/gold-etfs-holdings-and-flows/2023/11) from the World Gold Council.

Physically backed gold ETFs track the price of gold through direct ownership of the metal. While the largest such fund, the $56.3 billion [**SPDR Gold Trust (GLD)**](https://www.etf.com/GLD), owns bars of gold held in vaults in London, the [**iShares Gold Strategy ETF (IAUF)**](https://www.etf.com/IAUF), in contrast, tracks the price of gold using the commodity futures market.

High interest rates were a leading cause of outflows this year, according to [GLD sponsor](https://www.spdrgoldshares.com/usa/key-information/) World Gold Council. As rising rates pushed [Treasury](https://www.etf.com/topics/treasury) yields higher, those who stayed in gold missed out. Gold and Treasuries are both meant to be safe-haven assets during times of risk and market turmoil, and so the more attractive Treasuries become, the less lustrous gold appears in comparison.

## Global Gold ETFs 

This year’s gold fund flows shared a notable trait: uneven geographic distribution. For example, of October’s $2 billion in net outflows from physical gold ETFs worldwide, most (about $1.6 billion) came from North America, while about $600 million stemmed from [Europe](https://www.etf.com/topics/europe). Other markets, including $81 million in [Asia](https://www.etf.com/topics/asia-pacific), experienced nearly $140 million in inflows.

Year-to-date flows follow a similar pattern, with $5.8 billion in North American outflows, $7.8 billion in outflows from Europe and $1 billion of inflows from Asia.

 
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## Peaking Yields: A Golden Opportunity?

While high [bond](https://www.etf.com/topics/bond) yields have siphoned funds out of gold ETFs after rising most of the year, the yield on the [10-year Treasury](https://fred.stlouisfed.org/series/DGS10) bond peaked in late October at about 5%. Since then, it’s tumbled to 4.4%, with the [five-,](https://fred.stlouisfed.org/series/DGS5) [20-](https://fred.stlouisfed.org/series/DGS20), and [30-year](https://fred.stlouisfed.org/series/DGS30) Treasuries experiencing similar declines. The [one-year Treasury](https://fred.stlouisfed.org/series/DGS1) yield, however, has remained fairly flat.

If this trend continues, it could prove a boon to physical gold ETFs, lowering the opportunity cost for gold. In a potential sign the sector may be starting to experience a turnaround, GLD has received [$1.5 billion](https://www.etf.com/etfanalytics/etf-fund-flows-tool-result?tickers=GLD&startDate=2023-11-01&endDate=2023-11-24&frequency=DAILY) in inflows so far, in November, according to etf.com data.

*Contact Gabe Alpert at gabriel.alpert@etf.com*



 

 

 [ Gabe Alpert ](/authors/gabe-alpert) 

 

 

  Gabe Alpert is a former data reporter at etf.com with over seven years’ experience in financial journalism. He also previously contributed reporting…   [View Bio](/authors/gabe-alpert)

 



 

 


 Related Topics  [Gold](http://www.etf.com/topics/gold) 

 [Treasury](http://www.etf.com/topics/treasury) 

 [Yield Curve](http://www.etf.com/topics/yield-curve) 

 [Bond](http://www.etf.com/topics/bond)