Thursday, May 10, 2018

World Gold Council wants to entice more people into gold by offering them a new paper gold option

Does anyone find it both ironic and disturbing that the World Gold Council (WGC) owns the world's largest paper gold investment platform, and now wants to help entice even more investors into owning gold (paper gold) by creating a second ETF?

That is exactly what is happening as an announcement by the WGC on May 9 will see the creation of a second gold based ETF for investors who want to hold a contract on the precious metal, but the flexibility of market liquidity.

The World Gold Council (WGC) is anticipated to launch a new gold-backed ETF, reports Reuters. The WGC owns the world’s largest gold-backed ETF—the SPDR Gold Shares ETF (GLD US), which is marketed by ETF giant SSGA— but is creating a second gold offering with lower management fees. 
Gold ETFs offer investors cost-effective exposure to gold without having to buy and store the yellow metal. 
As reported by Reuters, “The council’s two funds were designed to appeal to different audiences, with the new product targeted at investors looking to buy and hold gold who want a low management fee, and GLD aimed at financial investors who use its scale and liquidity to trade in and out of positions cheaply.” 
The Reuters source commented, “The idea is that the new product grows without damaging the existing product.” 
Launched in 2004, GLD currently houses just over $36 billion in assets under management. – ETF Strategy

It is sad when the global governing body for gold sees ownership of the precious metal more as an investment, than as money and a store of wealth.  Because owning gold is not simply about trying to trade it back and forth like a equity position, but about physically holding it outside the system as both insurance, and away from any sort of counter-party risk.

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