Franklin Templeton has launched a low-cost physically backed gold ETF in the US with all underlying bullion holdings sourced from ethical miners and refiners.

Franklin Templeton has introduced a low-cost gold ETF suitable for ESG-focused portfolios.

The Franklin Responsibly Sourced Gold ETF (FGLD US) has been listed on NYSE Arca with an expense ratio of 0.15%.

The ETF offers one of the lowest-cost vehicles for physically backed gold exposure in the US – the cheapest gold ETF is the $5.0 billion SPDR Gold MiniShares Trust (GLDM US) which costs 0.10%, while the $1.0bn iShares Gold Trust Micro ETF (IAUM US) is also priced at 0.15%.

Other low-cost gold ETFs that are priced below 0.20% are offered by Goldman Sachs, GraniteShares, and Aberdeen Standard.

Despite entering a relatively crowded field, the new ETF’s ESG credentials allows the fund to stand out from its competitors – each share in the ETF is 100% backed by London Good Delivery gold bullion bars that were refined after 1 January 2012 in accordance with London Bullion Market Association’s (LBMA) Responsible Gold Guidance.

The LBMA’s framework establishes minimum mandatory requirements along the entire gold supply chain for all suppliers wishing to trade with the London Bullion market. It is intended to ensure that London Good Delivery gold is mined and refined through verified supply chains that meet internationally recognized ethical standards in terms of protecting the environment and combatting money laundering, terrorist financing, and human rights abuses.

David Mann, Head of Global ETF Capital Markets at Franklin Templeton, said: “We are excited to offer the Franklin Responsibly Sourced Gold ETF as one of the most cost-effective gold ETFs in the market. We believe it’s a fantastic option for investors looking to add gold investments to their portfolios, offering a compelling way to participate in the physical gold market with the added peace of mind of knowing that this gold is responsibly sourced.”