Until these funds launched, U.S. investors could access platinum through exchange traded notes (ETNs), and there was no palladium ETN. ETNs act like they own the physical commodity, although they don’t. [Platinum plays for price runs.]
The two new funds will buy and sell “baskets” of metal to handle liquidations and purchases. The prospectus for the funds state that the trusts will be discontinued and liquidated if the fund doesn’t have $350 million on its books in the first year. The ETFS Palladium Trust will sell $250 million in shares and the ETFS Platinum Trust will start out with $500 million.
For more information on platinum, visit our platinum category.
- E-TRACS UBS Bloomberg Long Platinum ETN (NYSEArca: PTM): up 3.1% in the last month
- iPath Dow Jones AIG Platinum TR Sub-Index ETN (NYSEArca: PGM): up 4.3% in the last month
Max Chen contributed to this article.