A Closer Look at the VanEck Merk Gold Trust Amid Market Strength

VanEck Merk Gold Trust US9210781012

The VanEck Merk Gold Trust (OUNZ) provides investors with direct exposure to physical gold bullion, positioning it to benefit from the precious metal's recent price appreciation. While gold has retreated slightly from an all-time peak set earlier this week, it continues to trade near elevated levels, raising questions about the fund's utility as a vehicle for holding tangible assets.

Recent price action shows gold's dynamic movement. After reaching a record high of $4,642.72 per ounce two days ago, the spot price currently stands at $4,585.04. The trust mirrors this physical market, holding 100% allocated London Good Delivery bars. As of early January, its holdings totaled 575,553.933 ounces.

A distinctive feature of OUNZ is its physical delivery option, allowing shareholders to exchange their shares for actual gold bars. According to the fund's structure, this transaction only becomes a taxable event when the gold itself is sold.

Recent Returns (NAV-Based):
* Week-to-Date: +3.20% (as of yesterday)
* One Month: +7.0% (as of two days ago)
* Three Months: +9.4% (as of two days ago)
* Year-to-Date NAV Return: +6.76% (as of yesterday)
* Year-to-Date Price Return: +5.37% (as of today)

Market Drivers and Countervailing Forces

Several powerful trends are supporting gold's rally. Persistent geopolitical tensions continue to fuel its appeal as a traditional safe-haven asset. Furthermore, central banks have been significant buyers; China, for instance, has expanded its purchases consistently for 14 months through December 2025.

However, headwinds exist. Stronger-than-expected U.S. economic data has pushed back market expectations for Federal Reserve interest rate cuts. A more restrictive monetary policy stance could pressure non-yielding assets like gold. Analysts note that robust demand from official institutions is currently offsetting this potential drag.

Liquidity, Costs, and Competitive Positioning

The fund maintains healthy trading activity. Its average three-month volume is approximately 1.31 million shares, with yesterday's volume coming in at around 1.65 million shares. Shares traded at a minimal discount to Net Asset Value (NAV) of about -0.2667% as of yesterday.

With assets under management of roughly $2.65 billion, OUNZ charges an expense ratio of 0.25%. This makes it a competitively priced option, on par with the iShares Gold Trust (IAU) and cheaper than the SPDR Gold Shares (GLD) at 0.40%, though the Aberdeen Standard Physical Gold Shares ETF (SGOL) is lower at 0.17%. The physical delivery option remains a key differentiator from larger competing funds.

Forward-Looking Assessment

In the near term, the trajectory of Fed policy remains a critical risk factor. Should higher yields and robust U.S. data persist, gold could face downward pressure. Conversely, sustained central bank purchasing and strong inflows into gold ETFs provide underlying demand support.

Some institutions see further upside potential. J.P. Morgan analysts suggest that, assuming demand persists, gold could advance toward $5,000 per ounce by the fourth quarter of 2026. From a technical perspective, the recent record high of $4,642.72 is viewed as a significant reference point for gauging future price movements.