There’s been a lot of talk lately about the largest gold exchange traded fund (ETF), and most of the talk hasn’t been so positive. Some of it has gone so far as to claim that it’s “defrauding” investors because it can’t have the gold it says it does. Read on, and we’ll tell you where it comes from.
Answering the question took a simple phone call.
The SPDR Gold Shares ETF (GLD) is by the far the most popular gold investment product and the data containing the quantity and quality of the bullion backing the ETF can be found at the Hong Kong and Shanghai Banking Corporation, or better known as HSBC, states Tim Iacono of Iaconon Research LLC. He states this is where the gold transfers occur – it’s not at the Comex or any other gold market.
What makes it difficult for investors is that these are generally internal transactions and the records aren’t made public, therefore making it difficult to see where the actual gold is coming from.
Gold ETFs are one of the easiest and cost-efficient ways to own the commodity, as they eliminate the need for storage space, as well as the cost of that storage.
In regard to GLD, it is up 6.31% year to date and is above both its 50-day and 200-day moving averages.
Kevin Grewal contibuted to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.