The majority of gold ETFs are set up as trusts. The fund owns a specific quantity of gold bars for each ETF share issued under this structure. This is accomplished by storing gold bullion, bars, and coins in a vault on behalf of investors.
Purchasing a share of the ETF entitles you to a piece of the trust's gold holdings. These ETFs' values fluctuate with the price of gold in the short and long term since they hold actual gold.