01—Abstract
Summary
Summary of the 10-K filed November 30, 2006. Cited figures are marked; the original filing is the authoritative source.
SPDR Gold Trust (GLD) filed its 2006 annual report (10-K) on November 29, 2006, detailing its structure and operations as of September 30, 2006.
The Trust was established in November 2004 to offer investors a convenient and cost-efficient way to gain exposure to the price of gold bullion. It achieves this by holding physical gold and issuing shares that represent fractional ownership of this gold, aiming to track the performance of gold prices less Trust expenses. The Trust operates by creating and redeeming shares in large blocks called 'Baskets,' exclusively through Authorized Participants.
These shares are exchange-traded on the NYSE, offering liquidity and ease of access compared to direct gold ownership. The filings highlight the Trust's reliance on service providers like the Sponsor (World Gold Trust Services LLC), Trustee (The Bank of New York), Custodian (HSBC Bank USA, N.A.), and Marketing Agent (State Street Global Markets, LLC). The report also provides insights into the global gold market, including supply and demand dynamics and the historical price movements of gold leading up to September 2006.
02—Key points
Key Highlights
- SPDR Gold Trust (GLD) aims to mirror the performance of gold bullion prices, less expenses, by holding physical gold.
- Shares are created and redeemed in 'Baskets' exclusively through Authorized Participants.
- The Trust is exchange-traded on the NYSE, offering liquidity for investors.
- Key service providers include the Sponsor (WGTS), Trustee (BNY), Custodian (HSBC), and Marketing Agent (SSGM).
- The report details historical gold price movements, noting a significant upward trend from early 2001 through September 2006.
- Expenses are paid through the sale of the Trust's gold, which can reduce the amount of gold per share over time.
- The Trust is structured as a grantor trust for tax purposes, with income and expenses flowing through to shareholders.
03—Questions
Frequently Asked Questions
What is the primary investment objective of the SPDR Gold Trust (GLD)?
The primary investment objective of the SPDR Gold Trust (GLD) is for its Shares to reflect the performance of the price of gold bullion, less the Trust's expenses.
How can investors buy or sell SPDR Gold Trust (GLD) shares?
Investors can buy or sell SPDR Gold Trust (GLD) shares on the New York Stock Exchange (NYSE) through a traditional brokerage account, similar to trading other publicly traded securities.
How are shares of the SPDR Gold Trust created and redeemed?
Shares of the SPDR Gold Trust are created and redeemed only in large blocks called 'Baskets' (100,000 shares) and exclusively through Authorized Participants. These participants exchange physical gold with the Trust for Baskets of shares (creation) or Baskets of shares for physical gold (redemption).
What are the main expenses associated with holding SPDR Gold Trust (GLD) shares?
The main expenses associated with holding SPDR Gold Trust (GLD) shares are fees paid to the Sponsor (0.15%), Trustee (0.02%), Custodian (0.10% on first 4.5 million ounces, 0.06% thereafter), and Marketing Agent (0.15%). These expenses are paid by the Trust through the sale of its gold holdings.
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