10-QPeriod: Q2 FY2020

SPDR GOLD TRUST Quarterly Report for Q2 Ended Mar 31, 2020

Filed May 8, 2020For Securities:GLD

Summary

The SPDR Gold Trust (GLD) reported a significant increase in its Net Assets from $43.96 billion at September 30, 2019, to $50.01 billion at March 31, 2020. This growth is primarily driven by a substantial appreciation in the value of its gold holdings, reflecting a strong upward trend in gold prices during the period. The Trust experienced net creations of shares, indicating increased investor demand for gold exposure. Despite the positive net asset growth and unrealized gains, investors should be aware of the trust's expense ratio and the inherent volatility of gold prices, which can be influenced by a wide range of global economic and geopolitical factors. The report also highlights the Trust's operational structure, emphasizing that it holds physical gold and its net asset value directly tracks the price of gold, less expenses. The impact of the COVID-19 pandemic is noted as a potential risk factor, introducing market volatility and operational uncertainties, although its material impact on the Trust's operations was not yet evident as of the reporting date. Investors should consider these factors when evaluating the current and future performance of GLD.

Financial Highlights

9 data points
Beta

Net Income

$2.35B

EPS (Diluted)

$7.47

Total Assets

$50.08B

Cash & Equivalents

$0.00

Free Cash Flow

$0.00

Financial Statements
Beta
Operating Expenses$46.47M
Net Income$2.35B
EPS (Basic)$7.47
Shares Outstanding (Basic)313.96M

Key Highlights

  • 1Net Assets increased significantly from $43.96 billion to $50.01 billion between September 30, 2019, and March 31, 2020.
  • 2The value of the Trust's Investment in Gold appreciated considerably, from $44.17 billion to $49.90 billion, reflecting a rise in gold prices.
  • 3Net income for the three months ended March 31, 2020, was $2.35 billion, a substantial increase from $344.84 million in the same period of the prior year.
  • 4The Trust saw net creations of shares, with 16,400,000 more shares created than redeemed in the six months ended March 31, 2020, indicating increased investor demand.
  • 5Total expenses for the three months ended March 31, 2020, were $46.47 million, compared to $32.75 million in the prior year period.
  • 6The Trust holds 31,014.7 ounces of gold with a fair value of $49.90 billion as of March 31, 2020, representing 99.79% of Net Assets.
  • 7The report acknowledges the potential risks posed by the COVID-19 pandemic on operations and market volatility, though it had not materially affected operations to date.

Frequently Asked Questions

The primary driver of the SPDR Gold Trust's performance is the price of gold bullion. The Trust holds physical gold, and its Net Asset Value (NAV) per Share aims to reflect the performance of the price of gold, less the Trust's operating expenses.

In the quarter ending March 31, 2020, the SPDR Gold Trust saw a significant increase in its Net Assets, rising to $50.01 billion from $43.96 billion at the end of the previous fiscal year. This growth was largely due to the appreciation in the fair value of its gold holdings, which resulted in a substantial net income of $2.35 billion for the quarter, compared to $344.84 million in the same period of the prior year.

The report mentions that the Trust, its Sponsor, and service providers are vulnerable to public health crises like the COVID-19 pandemic. Potential impacts include operational disruptions and market volatility. However, as of March 31, 2020, the COVID-19 pandemic had not materially affected the Trust's operations.

The SPDR Gold Trust's core function is to hold physical gold. While it recognizes realized gains or losses from selling gold to cover expenses or from distributing gold during redemptions, its primary value driver is the change in the market price of gold. The Trust does not actively manage its gold holdings or engage in hedging strategies.