There is an ETF for everything, and it seems that every different ETF and fund managing family wants to have its own version of each with its own twist. Thursday marks the launch of the Global X Gold Explorers ETF (NYSE: GLDX).
Global X noted that this gold ETF is different in that it is the world’s first ETF offering access to a unique segment of the gold mining life cycle via the gold exploration companies. The Global X Gold Explorers ETF tracks the Solactive Global Gold Explorers Index, which in turn tracks the performance of the largest and most liquid listed companies globally active in the exploration of gold. In short, many are international rather than U.S.-based companies and U.S.-based companies have a mere 18.83% weighting, Global X says.
There is a similar ETF in the Market Vectors Gold Miners ETF (NYSE: GDX) followed by the Market Vectors Junior Gold Miners ETF (NYSE: GDXJ). The GDX tracks the AMEX Gold Miners index, which includes some exploration companies but is dominated by the largest players. The GDXJ tracks the smaller and less-liquid gold-mining companies.
Gold-exploration companies have a higher-risk and higher-reward profile than many of the traditional diggers and royalty companies. In many cases, explorers are often to gold what wildcatters are to oil. Global X even went as far as calling explorers “the venture capital of gold.”
The fund launched today has a total annual operating expense of 0.65%.
The following weightings are listed for Global X Gold Explorers ETF:
Detour Gold Corp. — 4.75%
European Goldfields Ltd. — 4.75%
Novagold Resources Inc. — 4.75%
Gabriel Resources Ltd. — 4.75%
Seabridge Gold Inc. — 4.75%
Ventana Gold Corp. — 4.75%
Fronteer Gold Inc. — 4.75%
Rubicon Minerals Corp. — 4.75%
Guyana Goldfields Inc. — 4.75%
Colossus Minerals Inc. — 4.60%