(Bloomberg) -- Investors just fell out of love with gold in a big way.
The U.S. equity exchange-traded fund that experienced the largest withdrawals last week was the $10.3 billion VanEck Vectors Gold Miners (GDX), the biggest ETF that invests in gold-mining companies. The SPDR Gold Shares ETF (GLD), the world’s largest commodity ETF at $34.8 billion, also saw the most outflows among commodity funds in the period ending April 28.
"GDX is a leveraged play on gold," said Eric Balchunas, ETF analyst at Bloomberg Intelligence. "This is like playing a game -- everyone investing in these has their finger on the trigger."
Investors yanked $778 million from the VanEck Vectors fund and $217 million from the SPDR Gold Shares ETF, according to data compiled by Bloomberg.
The outflows coincided with the outcome of the first round of the French presidential election, in which centrist Emmanuel Macron and far-right candidate Marine Le Pen accumulated the most votes. This result was in line with investors’ expectations as well as public opinion polls. The need for protection against monetary discord lessened as Macron is seen as heavily favored to defeat Le Pen in the second round of voting.
"You’ll find with GLD, people tend not to use it as an inflation hedge, but a crisis hedge," said Balchunas. "When you have a potential event, especially geopolitical, brewing, you’ll see it take in cash, so it’s only logical that you’d see people exit last week."
Five-year real rates -- which tend to move inversely to the precious metal -- actually edged lower last week as the price of gold fell 1.3 percent.