ETF Securities is a fast-growing provider of specialized metals exchange traded funds (ETFs), so when the company proffers its thoughts on the metals market, investors tend to sit up and listen closely.

Olivier Ludwig for Index Universe recently sat down for a chat with ETFS Chairman Graham Tuckwell, and some interesting facts were revealed:

  • ETFS Securities is going to continue to build out its metals lineup. They are also going to continue to be huge proponents of those products and make the case for why investors may want to own them.
  • Where the gold is vaulted for a physically-backed ETF matters. If you have some gold vaulted in Singapore, versus some in London, the gold in London may seem much more safe, depending on which investor you speak with. It’s all about your perception when it comes to where metals are domiciled; where are you most comfortable with it being stored?
  • More often than not, it is cheaper being in futures than in physical metals, though there’s a big difference in the cost of futures-based commodities. In physical products, on the other hand, there might be a higher cost of ownership, but the tradeoff is less mystery.

Some of the most popular physically-backed metals ETFs trading in the United States right now include SPDR Gold Shares (NYSEArca: GLD), ETFS Physical Platinum (NYSEArca: PPLT) and iShares Silver Trust (NYSEArca: SLV). The primary benefits are that they give you low-cost exposure to physical metals without the need for finding and paying for storage. Easy, peasy.

Tisha Guerrero contributed 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.