ETFs Slice, Dice Gold Miners


"ETFs are cutting the mining sector into increasingly thinner slices."

In the less than two decades that have followed the launch of the SPDR S&P 500 ETF, the ETF industry has blossomed in a major way.

Today, over 1,000 funds are available which allow investors to tap into a vast array of market slices. The popularity of these products has taken off, with total assets breaching the $1 trillion mark in late 2010.

The story of the ETF industry's expansion has been one of investor demand. In an effort to provide investors with new and attractive products, some companies have revisited previously explored regions of the marketplace, creating funds which cut a well-known sector into increasingly thinner slices.

Earlier this week, Global X unveiled the Global X Pure Gold Miners ETF. Investors now have four separate products aimed at satisfying investor demand for gold producers, Market Vectors Gold Miners ETF being the first in 2006.

Like GDX, GGGG provides investors with exposure to a basket of large, liquid gold miners. However, according to the fund's fact sheet, GGGG's underlying index, the Solactive Global Pure Gold Miners Index, focuses specifically on producers which, "generate the vast majority of their business from gold mining."

The ETF industry remains a relatively young entity within the broader investing world but its evolution has been quick and dramatic. Already, the advent of these products has opened up a vast range of new opportunities for retail investors and, judging by the speed at which new products are being developed and launched, this is a trend that appears set to continue.

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