ETFs have become very popular in recent years and there seems to be one covering everything. The number of ETFs that focus on commodities have particularly grown in number, due to the instability in the economy. Gold ETFs have become some of the most popular investments today and ETF Securities is one of the newest players in this realm.
The company is based in London and well-known in the European ETF market but is new to the United States. IT offered four ETFs with individual holdings in silver, palladium, platinum, and gold. The most popular of these is the ETF Securities Physical Swiss Gold Shares. Its daily volume exceeds 100,000 shares and it holds more than $600 million in assets.
What makes ETFS Physical Swiss Gold Shares different from other funds backed by physical gold is that it holds all the gold in a Swiss vault. These holdings are subjected to an audit two times per year and gold bar figures are published on the company’s Web site. This provides investors with a degree of comfort that their investments are safe.
ETFS recently completed SEC filings regarding a new ETF with gold bullion located in a vault in Singapore. This area of the world is coming to the forefront of the financial arena due to impressive growth rates in Asia. If approved, the fund will be the fifth gold ETF with underlying bullion holdings. It will be the first with gold storage in a vault located in the non-Western world. This fact makes it possible for investors to further diversify their holdings and mitigate existing political risk.
The ETFS prospectus states that Singapore is “one of the largest gold trading centers in Asia” and that it is “slowly becoming a hub for investment trading.” What makes the country even more attractive is its non-corrupt legal system and stability when it comes to politics. In a recent report regarding competitiveness, Singapore fell in the top ten when it came to regulation regarding securities exchanges, legal rights, and investor protection. If it comes to the market, it is likely that this fund will quickly become popular.
Source: Dutram, Eric. ETF Database. Next Up: Gold ETF With Vaults In Asia.