Tuesday, April 27, 2010

Finally a Physically-Backed, Bar-Listed, Currency-Hedged Gold ETF

Claymore has a very interesting way of investing in gold through a physically-backed ETF. It is not only physically backed, but it lists the bar numbers in its possession and is currency hedged.

The ETF seeks to "replicate the performance of the price of gold bullion, less its expenses and fees". It allows:

The gold Bullion is stored in the treasury vault facilities of ScotiaMocatta (a division of the Bank of Nova Scotia.)

The management fee is 0.50%, including all operating expenses, including custody fees.

Bar list:

The bars are listed on their site. This is the top of the list today:

Currency hedged.

While Americans that invested in gold had a nominal gain since January 2009, the same was not true for investors in other currencies such as Canadians, Australians and Brazilians.

From our live tracking site of gold in other currencies:

The above represents the performance since January 2009.

The chart below compares the gains for GLD priced in CAD dollars, spot gold nominal, and CGL since its launch on February 16 2010. The white and the light blue line are nominal GLD and CGL. The tracking is very good indeed. Had Canadians bought GLD, that would be purple line. Yellow is the CAD/USD (through the FXC ETF).

(please click to enlarge)

So those are very positive features of CGL. On any significant gold pullback this is worth considering for those interested in gold.

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