Hi kids! Long time no post. Saw this and wanted to share:
Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
Executive summary:
"GLD is the best choice for short term traders but has a high decay rate, IAU for long-term holders, and PHYS has the best redemption and auditing policies."
Oh, and those of us who believe in the potential (if not imminent) implosion of the fiat monetary system are either "crazies" or "Armageddonists". Hmm.
Full disclosure: I happen to hold IAU (due to its lower ER than GLD), and SGOL (due to it being commision-free at Schwab).
Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
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Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.
- H. L. Mencken
- H. L. Mencken
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buddtholomew
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Re: Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
Unfortunately, they all have the same thing in common...NAV continues to decline 
just had to throw that in there on a Friday afternoon.
just had to throw that in there on a Friday afternoon."The first principle is that you must not fool yourself and you are the easiest person to fool" --Feynman.
Re: Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
Nice!buddtholomew wrote: Unfortunately, they all have the same thing in common...NAV continues to decline
Anyways, not sure how GLD has a "decay." Do they mean the ER?
Re: Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
That's my guess. At .4%/yr if you hold it for 20 years you give up nearly 8% (about 7.7% because the total is dwindling). And, if you're holding it in a taxable account you have to pay taxes along the way as well (they sell gold to pay the ER and if there was a profit involved this profit is passed along to you).dragoncar wrote: Anyways, not sure how GLD has a "decay." Do they mean the ER?
Re: Gold Funds Compared By Efficiency, Physical Redemption And Audit Policy
The article says that GLD and IAU offer physical redemption (in basket sized lots). This is not true, at least for GLD. Per GLD's FAQ, shares can be redeemed for gold (in basket sized lots) only by Authorized Participants. If you're not an AP then the only thing you can do with your shares is sell them to someone else (as shares). Perhaps if you're sufficiently "whale-ish" you can make a deal with an AP. Curiously, GLD lists "who are the APs" as one of their FAQs but doesn't answer this question (they're all the usual suspects, e.g. JP Morgan, Goldman Sachs, HSBC, etc.). I did track down who they were at one point and as I recollect it wasn't very easy.