Hedge fund, also known as hedge fund or arbitrage fund, refers to a financial fund that combines financial derivatives such as financial futures and financial options with financial institutions and obtains profits by means of high-risk speculation. It is a form of investment fund, which belongs to exempt market products. It means "risk hedge fund". Hedge funds are called funds, which are essentially different from mutual funds in terms of security, income and appreciation.

The so-called gold ETF fund refers to a financial derivative product based on gold and tracking the fluctuation of spot gold price. China Mainland is still in a "virgin land", and domestic investors know little about gold ETF funds, but gold ETF funds are extremely popular in overseas markets.

2. The operation principle of gold ETF is that large gold producers entrust physical gold to fund companies, and then the fund companies publicly issue fund shares on exchanges based on this physical gold and sell them to various investors. Commercial banks act as fund custodians and physical custodians respectively, and investors can freely redeem the funds during their existence.

Gold ETF is listed on the stock exchange, and investors can trade gold ETF as easily as buying and selling stocks. Low transaction cost is a major advantage of gold ETF. Investors don't have to pay gold custody fees, custody fees, insurance fees and other fees when buying gold ETFs, but only pay the usual management fee of about 0.3% to 0.4%, which is very prominent compared with the average handling fee of 2% to 3% in other gold investment channels. In addition, gold ETF also has the advantages of safe storage and strong liquidity.

Due to the high price of gold, gold ETF generally takes 1g as a fund unit, and the net asset value of each fund unit is the spot gold price 1g minus the accrued management fee. Its transaction price or secondary market price in the securities market is based on the net asset price per share.