Australian gold funds are shaping up for a bumper year as mining companies start to capitalise on record prices, helping the stocks to finally catch up to the performance of the precious metal.

Portfolio managers were left frustrated last year after a jump in production costs held back ASX-listed gold producers from riding the rally in the spot prices to record levels. The VanEck Gold Miners exchange-traded fund climbed nearly 20 per cent in 2024 versus a 38 per cent rally for the gold price in Australian dollars.