Gold’s Record Run Fuels Investor Interest in Physical ETF Option

The VanEck Merk Gold Trust (OUNZ) is capturing significant investor attention as gold prices maintain a powerful upward trajectory through 2025. This sustained rally underscores the precious metal’s enduring status as a premier safe-haven asset during periods of economic uncertainty, with the ETF offering the distinctive feature of physical share redemption.

Driving Forces Behind the Precious Metal’s Ascent

A convergence of macroeconomic factors is propelling gold’s impressive performance. Resurgent inflationary pressures across both European and American economies, ongoing geopolitical instability, and a cautious, hesitant approach from the Federal Reserve have created a potent mix driving capital into gold. This flight to safety is further amplified by central banks worldwide, which continue accumulating the metal at record-breaking levels.

These forces have pushed gold to multi-year highs, with its price approaching the key psychological barrier of $3,500 per ounce—its all-time peak. The momentum is undeniable: August alone witnessed a substantial gain of almost 5%, closing the month above $3,429. This achievement marks the seventh consecutive monthly record set during the year.

Pure Gold Exposure with a Physical Redemption Advantage

Unlike many competitors, the VanEck Merk Gold Trust provides direct exposure to physical gold, specifically held in the form of London Good Delivery bars. The fund’s entire allocation is securely vaulted with JPMorgan Chase Bank, N.A., ensuring each investor holds a proportional, direct claim on the underlying bullion.

The ETF’s most compelling characteristic is its unique redemption mechanism. Shareholders possess the option to exchange their fund shares for physical delivery of the gold itself. This feature is particularly attractive to investors seeking genuine, tangible ownership beyond a paper-based financial instrument, setting OUNZ apart in the crowded ETF marketplace.

Should investors sell immediately? Or is it worth buying VanEck Merk Gold Trust?

A Performance Review

The fund’s performance metrics vividly illustrate its strong alignment with the bullion’s rally:
– Daily Performance: +0.94%
– Weekly Performance: +2.43%
– Monthly Performance: +4.95%
– Year-to-Date Performance: +31.50%

Trading liquidity remains robust, with an average daily volume of approximately 578,000 shares. The ETF trades efficiently, maintaining a price very close to its net asset value (NAV), with minimal tracking deviations typically ranging between -0.03% and 0.04%.

Standing Out in a Competitive Field

While larger ETFs like the SPDR Gold Shares (GLD) and the iShares Gold Trust (IAU) dominate in terms of total assets under management, the VanEck Merk Gold Trust carves out its niche through its physical delivery option. For discerning precious metal investors, this ability to convert a holding into actual bullion represents a critical strategic advantage.

The fund’s one-year tracking difference of 13.82% reflects the operational costs associated with providing physical vaulting and the redemption feature. In the current climate of widespread economic and geopolitical uncertainty, a growing number of investors appear to view this premium as a worthwhile expense for the enhanced security and flexibility it provides.