- Investing in gold stocks that pay dividends provides an opportunity to earn precious metals income in the form of regular cash flows and capital appreciation of the securities.
- Dividend-paying gold stocks fall into two categories. The first type comprises stocks of companies engaged in mining. The second comprises shares in gold streaming companies.
- The dividend yield of gold stocks and their market value dynamics depend heavily on the price of gold. They are also less correlated with companies from other sectors.
- Gold mining dividends represent an unstable source of income. Even senior gold miners may not pay dividends during periods of downturn in the gold market.
This article will discuss suitable investment strategies for gold investment dividends and provide a list of the best gold stocks with dividends.
Table of Contents
Understanding Gold Stocks and Their Dividend Potential
The potential for dividend stability varies among gold stocks that pay dividends. Gold royalty companies offer the highest dividend sustainability. Such companies provide advance financing to miners in exchange for a fixed percentage of their earnings.
Gold streaming companies provide capital in exchange for gold deliveries. In both cases, cash flow generation occurs without operational risk.
The next level comprises gold mining companies with a long-standing history of gold production. These are known as ‘senior miners’. They have stable cash flows and ample financial strength.
Junior miners are companies that are either in the exploration stage or have just begun mining operations. Such businesses carry high risks and have limited resources. They do not have the capacity to pay regular dividends. Investment in these companies is primarily advisable for the growth potential of the stock price, but it is important to remember the high risk of bankruptcy and losing money.
Types of Dividend-Paying Gold Investments
Gold mining portfolios can be built using either individual gold stocks or gold mining ETFs. Advantages of the former include the ability to select industry leaders and quickly sell companies that no longer meet an investor’s requirements.
Dividend-paying gold ETFs offer a diversified portfolio comprising dozens of companies. Let’s take a look at the most important ones:
- The Vectors Gold Miners ETF from VanEck (GDX) tracks the NYSE Arca Gold Miners Index. It includes companies with a market capitalization of over $750 million. The net expense ratio is 0.51%. Dividends are paid once a year. In December 2024, the dividend was $0.40 per share. The current dividend yield is 0.76%.
- The MSCI Global Gold Miners ETF from iShares (RING) tracks the MSCI ACWI Select Gold Miners Investable Market Index. The fund is traded on the NASDAQ stock exchange. It comprises 55 gold mining companies from developed and emerging markets. Its net expense ratio is 0.39%. The dividend yield is 1%. The fund pays shareholders twice a year.
- The Gold Miners ETF from Sprott (SGDM) uses the MSCI ACWI NR USD as its benchmark index. It tracks large gold mining companies whose shares are listed on US and Canadian stock exchanges. Dividends are paid once a year. The yield is 0.63%. The net expense ratio is 0.5%.
The size of Gold ETF dividends is unstable and they cannot form the basis of an income portfolio.
Top Dividend-Paying Gold Stocks and ETFs
The table below shows the top gold stocks with dividends, along with their key metrics.
| Company name (ticker) | 1 year performance, % | Dividend yield, % | Consecutive Years | Continuous Dividends | Dividend CAGR 5Y, % |
| Franco-Nevada (FNV) | +34.75 | 0.94 | 9 | 17 | 9.91 |
| Newmont Mining Corporation (NEM) | +34.58 | 1.67 | 0 | 39 | 12.3 |
| Barrick Mining (B) ex Barrick Gold (GOLD) | +24.05 | 1.86 | 0 | 38 | 15.28 |
| Kinross Gold (KGC) | +90.2 | 0.77 | 1 | 5 | – |
| AngloGold Ashanti (AU) | +62.02 | 1.07 | 1 | 7 | 26.47 |
As can be seen from the table, there are no gold dividend aristocrats that have increased their payouts for 25 consecutive years. The highest yielding gold stocks only just exceed the average level of the S&P 500.
Franco-Nevada (FNV) stands out among dividend growth gold stocks, as it has increased dividends for almost a decade.
SSR Mining shows that high prices do not guarantee success for a mining company. In 2024 and 2025, the company did not pay dividends. In February 2024, a major landslide occurred at one of its mines, resulting in production being halted. Consequently, the company recorded net losses for those years.
Advantages of Gold Dividend Stocks
Gold investments are traditionally considered an inflation hedge. Interest in gold increased when the price per ounce exceeded $3,500 for the first time. Due to its low correlation with other asset classes, gold can be used to enhance portfolio diversification. It can also be used as market volatility protection. Additionally, there is an inverse relationship between gold prices and interest rates.
Gold mining stocks offer several advantages as a physical gold alternative:
- Cash flow generation, which cannot be provided by physical gold bars. However, the dividend yield of such stocks is not solely dependent on the price of gold.
- There are no storage or security costs. The only additional expenses are the brokerage fees incurred when buying and selling shares.
- It has the ability to generate dividend income even during periods when the price of gold per ounce does not increase. However, this asset has high gold price exposure, which impacts stock quotes.
Risks and Considerations for Gold Dividend Investors
Gold stocks display high commodity price sensitivity and are subject to gold market cycles. They have low dividend sustainability. Dividend cuts may result from gold price volatility or operational challenges, primarily related to mining risks.
In order to minimize investment risks when purchasing gold stocks, it is essential to conduct thorough research on the company. This requires sufficient knowledge and time to analyze financial metrics.
The stocks of mining companies tend to be more closely correlated with the overall stock market than physical gold bars. Therefore, during severe economic crises, their value may decline alongside that of other securities. Unlike gold bars and coins, however, a gold stock will lose its value if the banking system and financial markets are disrupted.
How to Evaluate Gold Dividend Stocks
When selecting stocks, we take dividend sustainability metrics into account. These include the dividend payout ratio and the dividend coverage ratio, which is based on free cash flow. Other important data includes the debt-to-equity ratio, revenue and profit trends, and more.
When it comes to gold stocks, financial analysis should take mining fundamentals into account:
- information on gold reserves at the company’s mines;
- reserve replenishment ratio;
- total cash costs (all production costs related to gold mining);
- all-in sustaining costs (expenses for exploration, mine construction, and other related activities).
Building a Gold Dividend Portfolio Strategy
The first step in portfolio allocation is position sizing. Most diversification strategies allocate between 5% and 10% of the portfolio to precious metals. However, an all-weather portfolio increases the gold exposure limit to 25%.
The next step is to decide on a risk management approach. This involves choosing between ETF vs individual stocks. The advantages of ETFs include instant diversification and ease of trading. It is unlikely that a fund will stop paying dividends. Additionally, their prices are not affected by problems of a single company.
Investors who are confident in their understanding of the industry may prefer gold stock selection. In theory, this approach generates higher returns from company growth and dividends. However, considering the risks inherent in the mining sector, it is dangerous to allocate more than 3 – 5% of a portfolio to a single stock.
The Bottom Line
Gold dividend investing enhances portfolio diversification. It involves income generation that is not derived from the appreciation of the metal’s price, but rather through regular profit distributions from mining companies.
However, when choosing this investment strategy, it is important to consider the risk-reward profile as well as the portfolio benefits. As well as precious metals exposure, mining companies are subject to geological risks, technological challenges, accidents and other issues.
Therefore, gold mining stocks with dividends should constitute only a small percentage of an income-generating portfolio. The major advantage of these stocks is their ability to generate passive income while remaining uncorrelated with other sectors.
FAQ
Is there a gold stock that pays dividends?
Many gold mining companies pay dividends. However, streaming companies tend to have more stable payouts; Franco Nevada is a good example of this.
How to make $1000 a month in dividends?
An average portfolio yield of 5% requires an initial investment of $240,000. In addition to this, investors should select stocks based on the timing of dividend payments. Most companies distribute profits quarterly or less frequently.
Which is the best gold stock to buy?
Barrick Mining has been paying dividends for a long time. At the time of writing, this same company also has the highest current dividend yield.
Can you get dividends on gold?
Neither gold bars nor futures contracts on the precious metal generate dividends. However, passive income can be earned by investing in the individual stocks of mining and streaming companies, as well as certain gold ETFs.
Article Sources
- Crescat Capital (2024). “The Countercyclicality of Gold Mining Stocks.” Professional research analyzing historical performance of gold mining stocks versus broad market indices during major bear markets 1929-2009.
- Philadelphia Stock Exchange (1979-2024). “Philadelphia Gold and Silver Stock Index (XAU) Historical Analysis.” Capitalization-weighted index methodology and performance data for gold and silver mining companies.
- Barron’s Financial Services (1938-1988). “Barron’s Gold Mining Index (BGMI) Historical Data.” Long-term weekly data series for US publicly listed gold mining stocks, later repackaged as BGMI in 1988.
- TSI Network (2025). “Dividend Sustainability Rating System for Gold Mining Companies.” The Successful Investor, February 2025. Professional analysis using cash flow metrics for dividend-paying precious metals companies.
