Gyroscopic Investing

I appreciate the education as I try to understand the available products that approximate physical gold/silver.

As I understand it, AAAU holds allocated gold, and shares are redeemable for physical delivery. I believe PSLV plays a similar role for silver. Aside from trading volume, are there advantages to using other funds like GLD or IAU for gold or SLV for silver?

And am I correct in that SLV and GLD issue what are effectively fractional reserve shares?

Thank you all for your input.

Spyder wrote: ↑Sun Aug 16, 2020 8:29 pm I appreciate the education as I try to understand the available products that approximate physical gold/silver.

As I understand it, AAAU holds allocated gold, and shares are redeemable for physical delivery. I believe PSLV plays a similar role for silver. Aside from trading volume, are there advantages to using other funds like GLD or IAU for gold or SLV for silver?

And am I correct in that SLV and GLD issue what are effectively fractional reserve shares?

Thank you all for your input.

No. While there is some counterparty risk in bullion ETFs, which I believe to be quite low, they are not allowed to lend out their bullion. Shares can be lent by owners to speculative short sellers, but the bullion is there and subject to strict auditing.

I’ll throw one thing out there. GLD custodian is HSBC - a bank in Hong Kong that is supposed to be a very shaky financial footing. I am not a finance expert so this is only passing along what I have heard. You can Google George Gammon and HSBC. He discusses Kyle Bass’s opinion on HSBC. IAU custodian is JP Morgan it also had a slightly lower fee. I use IAU. I want to look more closely at AAAU as well. Also there is the criteria of volume. IE if you buy and sell easily. Not sure about AAAU but it is basically the Perth mint. Any just some thoughts.

With the vast majority of gold sitting in London as is the case with several gold funds.

https://www.spdrgoldshares.com/usa/faqs/

This is a good read for those interested in the details.

I would not trust my gold in the custody of any entity subject to the jurisdiction of the People's Republic of China. Period.