As the price of gold surges toward the $3000 mark per ounce, gold exchange-traded funds (ETFs) have captured the attention of investors worldwide. Recent statistics reveal a remarkable trend in investment behavior, particularly in China's market, where a significant influx of capital has been observed in gold-related ETFs following the holiday break.

Between February 5 and February 11, 2025, 18 out of 20 gold ETFs in the Chinese market experienced net inflows, aggregating a substantial total of 3.926 billion yuan. This marks a clear indication of the mounting interest in gold as a safe-haven asset amid unstable economic conditions and fluctuating market sentiments.

This global enthusiasm for gold is reflected not just within China but across the world. The World Gold Council reported that in January 2025, physical gold ETFs saw a net inflow of approximately $3 billion, showcasing a robust demand for gold investments on an international scale. As geopolitical tensions and economic uncertainties continue to loom, gold's position as a hedge against inflation and currency devaluation becomes increasingly relevant.

Analysts have pointed out that this sharp increase in gold prices is primarily driven by U.S. tariff policies. Fearful speculation around possible tariffs on gold imports into the United States has catalyzed a strong influx of arbitrage capital, consequently widening the price gap between COMEX gold and London gold. Market participants are prudently taking positions, anticipating further upward price movement.

Despite the bullish outlook suggesting that gold could climb to $3000 per ounce, investors are urged to remain vigilant regarding the actual implementation of tariff policies and the potential easing of physical market shortages that could exert downward pressure on prices. In addition, the monetary policy direction of the Federal Reserve is poised to significantly influence gold valuations, necessitating close monitoring of market developments.

The growth of gold ETFs has been phenomenal, with their net asset values reaching peak levels. Specifically, the Huaxin Gold ETF experienced the largest inflow, amounting to 1.131 billion yuan, with a total return of 6.26% over this period. Other prominent ETFs, including the E Fund Gold ETF and the Bosera Gold ETF, also garnered impressive inflows of 683 million yuan and 678 million yuan, respectively.

Moreover, five additional funds reported inflows exceeding 100 million yuan. The Huaxia Gold ETF attracted approximately 185 million yuan, while the Yongying CSI Hong Kong Gold Industry ETF saw an inflow of around 173 million yuan. Additionally, three gold ETFs benchmarked against Shanghai gold garnered over 100 million yuan each.

In the past week, several gold ETFs achieved record net asset values. Funds such as the Yongying CSI Hong Kong Gold Industry ETF, Ping An CSI Hong Kong Gold Industry ETF, and ICBC CSI Hong Kong Gold Industry ETF led the segment with over 7.5% gains. In total, the 20 gold-related ETFs observed weekly returns exceeding 6%, affirming the enduring allure of gold investments.

When taken over a longer timeframe, the year-to-date net asset value growth rate for these 20 gold ETFs surpasses 10%. Specifically, ETFs that follow gold-related equity indices, including those from Yongying, Huaxia, ICBC, and Guotai, registered returns exceeding 15%. Huaxin and Ping An gold equity ETFs also reported annual increases surpassing 14%.

On the global stage, the demand for gold investment is similarly witnessing a surge. The World Gold Council noted that by the end of January 2025, the total assets under management for global gold ETFs had climbed to an unprecedented $294.2 billion, an increase of $23.7 billion from the previous month. Additionally, daily trading volumes for gold in January reached an average of $264 billion, reflecting a remarkable 20% increase month-over-month. This surge is largely attributed to a 60% jump in trading volumes on the New York Mercantile Exchange (COMEX), which significantly contributed to the overall rise in global trading activity.

Despite this burgeoning interest, a trend of profit-taking has become apparent among certain investors. Data from Wind indicates that from early 2025 to the present, there has been a noticeable dichotomy in capital flows for China's gold ETFs. A total of 10 gold ETFs combined witnessed net outflows totaling around 1.234 billion yuan during the same timeframe. The E Fund Gold ETF experienced the largest outflow at approximately 500 million yuan, followed by the Bosera Gold ETF with 270 million yuan. Additionally, other products like the Southern Shanghai Gold ETF and Tianhong Shanghai Gold ETF each faced outflows exceeding 100 million yuan.

On the futures side, the Commodity Futures Trading Commission (CFTC) released figures indicating that as of the week ending February 4, 2025, long positions in COMEX gold futures decreased by 35,799 contracts, or 6.78%, totaling 492,482 contracts. Simultaneously, short positions fell by 34,445 contracts, or 6.23%, to 518,149 contracts. This saw non-commercial net long positions rising by 3,099 contracts to 302,508, comprising 55.8% of the market. Overall, total positions declined by 35,501 contracts, settling at 542,004 contracts as the number of total traders stood at 314.

In terms of price action, the gold market has exhibited a robust upward trajectory since February started. On February 11, 2025, the COMEX gold futures price hit $2968 per ounce, while spot gold reached $2942.7 per ounce, reflecting a cumulative increase of over 10% within the year. Many analysts predict that achieving the $3000 milestone is imminent based on current trends and investor sentiment.

As gold prices reach new heights, the Shanghai Gold Exchange announced on February 11, 2025, an increase in margin requirements for certain contracts and adjusted price limits, emphasizing the importance of risk management and measured investment strategies for participants. This proactive measure is designed to ensure market stability amid escalating volatility.

Huatai Securities noted that since the beginning of the year, gold inventories have been shifting from London to New York, with COMEX gold stocks increasing by 62%. This trend has contributed to tightened market liquidity, amplifying upward momentum for gold prices. While the market may face some fluctuations due to various factors in the short term, a pivotal shift in the long-term valuation trend appears unlikely. Structural factors continue to bolster gold's relative performance, particularly as concerns regarding U.S. fiscal and trade risks escalate, positioning gold for sustained strength in the foreseeable future.

Looking ahead to 2025, the World Gold Council's senior market analyst Louise Street anticipates that central bank demand for gold will remain dominant, while investment demand through gold ETFs will become a cornerstone of gold's continued support. A prevailing trend of reduced interest rates is expected, though volatility in rates may occur frequently. Furthermore, geopolitical conflicts and macroeconomic uncertainties are poised to serve as principal drivers of gold prices throughout 2025, shaping the future of gold investments in a dynamic global economy.