Published in ETF Strategy on December 14, 2020:
Goldman Sachs has completed its acquisition of the Perth Mint’s physical gold ETF.
Renamed the Goldman Sachs Physical Gold ETF (AAAU), the ETF’s fee is unchanged, at 0.18%, as is its listing on NYSE Arca.
The ETF also continues to provide the same fundamental function – namely physical exposure to gold bars meeting the specifications for “good delivery”, as defined by the London Bullion Market Association.
New custodian
But while the fee, listing venue, and investment objective are all unchanged, the original custodian, the Perth Mint, has been removed and, along with it, the ETF’s unique guarantee from the government of the State of Western Australia.
Also out with the Perth Mint is the ETF’s novel convertibility feature that allowed shareholders of the ETF to exchange their shares for delivery of physical gold in the form of bullion bars and coins issued by the mint.
In its place as custodian is the London branch of JP Morgan Chase – one half of a duopoly of banks (the other half being HSBC) that is home to an increasingly large and arguably alarming concentration (approx. 2,500 tonnes) of ETF-owned gold……
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He founded PVT Capital (AFSL number 546090), which provides income and growth strategies to wholesale clients.
Colin also co-founded Incredible Charts and writes the popular Patient Investor newsletter.
Using a top-down approach, Colin identifies macro trends in the global economy and then combines fundamental and technical analysis to evaluate opportunities in sectors that stand to benefit.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.