Gold ETFs are no longer just short-term hedges for investors bracing for market turmoil. Industry experts gathering at the Exchange 2026 conference in Las Vegas said the precious metal has evolved into a permanent portfolio component as global debt reaches record levels and traditional diversification tools break down.

The shift comes as gold posted back-to-back years as the top-performing U.S. dollar-denominated macro asset class in 2024 and 2025, a panel at the annual ETF-focused conference heard. With total global debt hitting $350 trillion and government debt reaching a record 33% share, investors are treating gold as protection against currency debasement rather than a temporary trade, according to State Street Investment Management.

During a session moderated by Todd Rosenbluth, head of research at TMX VettaFi, Aakash Doshi and Allison Bonds Mazza of State Street outlined why financial advisors are moving gold from tactical positions into core strategic allocations. Doshi said the market is in the “middle innings” of a bull cycle with a price target of $6,000 per ounce within the next 12 months.

The economic uncertainty index under what Doshi called “Trump 2.0” is double that of the first Trump administration, driving investors toward “left tail” hedges. But the more fundamental shift has been the breakdown of the inverse relationship between stocks and bonds since 2022, forcing portfolio managers to find new diversification tools, he said.

Gold now serves as a duration and diversification hedge in a way that traditional 60/40 portfolios can no longer deliver on their own, the panel said. Despite strong returns, global gold fund holdings remain below 1% of total assets, far below the suggested strategic target of 3% to 5%, according to Doshi, State Street’s global head of gold strategy.

Gold ETFs Over Physical Metal and Miners

The conversation at Exchange 2026 focused on how advisors should implement gold allocations in modern portfolios. Experts suggested gold should occupy a “liquid alternative sleeve” representing 3% to 7% of a portfolio, though some institutional investors, including Ray Dalio, allocate as high as 10% to 15%, the panel said.

Mazza, State Street’s head of U.S. wealth, emphasized that gold ETFs provide the most efficient access to physical gold prices without the complexity of futures or the equity risk of mining stocks. During the global financial crisis, gold remained flat to positive while miners dropped 50% alongside the broader equity market, she said.

Physical gold purchased as bars or coins often involves high markups at dealers, making ETFs like the SPDR Gold Shares (GLD) and the SPDR Gold MiniShares Trust (GLDM) more attractive for most investors, Mazza said.

The panel noted retail investors now account for 20% of State Street’s gold ETF assets, representing a shift in behavior. Major wealth management firms, including UBS, Morgan Stanley and Merrill Lynch have issued positive outlooks on gold, with UBS setting a price target as high as $6,200, according to the panelists.

As global gold fund holdings remain below 1% of total assets, the panelists said the gap between current positioning and the 3% to 5% strategic target suggests room for continued flows into gold ETFs as more advisors make the shift.

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