Is gold ETF investment risk high?

Gold ETFs are actually a type of fund. Gold ETFs give full investment power to professional financial experts in securities companies. They do n’t need investors to participate in research in person. They only need to reach agreement with experts, which saves investors a lot of trouble and Trouble is also popular with investors for this reason.

But no matter what investment does not make a profit, the same is true for gold ETFs, which are relatively risky. Is the gold ETF investment risk high? Gooe Gold teacher summarized the types of gold ETF investment risks for investors, and will definitely let Investors benefited. So what are the risks of gold ETF investment?

Tracking error risk

Generally speaking, investors use a simple arbitrage method. The risk is that they first use a damper that minimizes the error of tracking ETF prices. After obtaining the ratio of 2 ETFs, it is prone to errors in secondary tracking.

Because there will be a time difference between the first tracking and the second tracking, the data will often change in this time difference, causing the risk of tracking error.

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Liquidity risk

The risk of many investment products is that sometimes the liquidity is not enough, which is also a risk problem that often exists in other emerging investment products.

Inverse spread risk of spread

Sometimes, the spread has reached the arbitrage-free range, but the spread will not change immediately. At this time, if higher investment leverage is used, and the fluctuation of the spread is contrary to expectations, it will make investors caught by surprise, resulting in liquidation and comparison. Big losses.

Settlement and liquidation risk

The trading system of gold ETF is a daily settlement system and a forced liquidation system. Investors need to retain enough funds during the operation process. If it is a 70% position, it can basically cover 40% of unfavorable price fluctuations.

In addition, the risk should be considered in conjunction with the timing of the leverage factor. Other factors may also lead to the risk of settlement and closing positions, so investors need to pay attention.