What is the primary objective of the iShares Gold Trust (IAU)?

The primary objective of the iShares Gold Trust (IAU) is for the value of its Shares to reflect, at any given time, the price of gold owned by the Trust, less the Trust's expenses and liabilities. It is designed to provide investors with a vehicle to gain exposure to gold bullion.

How does the Trust generate revenue and what are its main expenses?

The Trust's 'revenue' is primarily derived from the gain on sales and distributions of gold. The main expense is the Sponsor's fee, which accrues daily at an annualized rate of 0.25% of the adjusted net asset value. Other administrative expenses are assumed by the Sponsor.

What is the significance of the 'redeemable capital shares' on the balance sheet?

Redeemable capital shares represent the units of beneficial interest in the Trust. They are classified as 'redeemable' because they can be exchanged for gold bullion. The significant increase in this line item indicates growing investor demand and the creation of new shares.

What is the concentration risk associated with investing in IAU?

The primary concentration risk for IAU is its substantial holdings in gold bullion. This means the value of the Shares is highly dependent on the price of gold, and any decline in gold prices will adversely affect the Trust's performance. Factors influencing gold prices, such as market sentiment, government actions, and producer hedging, directly impact investors.

IAU 10-Q Quarterly Report Q3 FY2012 — Revenue, Net Income, EPS

Summary

This 10-Q filing for the iShares Gold Trust (IAU) for the period ending September 30, 2012, highlights a significant increase in the Trust's net asset value, driven by both rising gold prices and an increase in the number of outstanding shares. The Trust reported substantial growth in its gold bullion inventory and redeemable capital shares, reflecting strong investor interest in gold as an asset during this period. The filing also details the operational aspects of the Trust, emphasizing its passive investment strategy focused on mirroring the price of gold, less expenses. Key financial performance metrics show a healthy increase in net income compared to the previous year, largely due to gains on gold distributions for share redemptions and sales to cover expenses. The Trust's expense structure remains lean, dominated by the Sponsor's fees, with other administrative costs covered by the Sponsor. Investors should note the inherent concentration risk associated with holding primarily gold bullion, making the Trust's performance directly tied to gold price fluctuations.

Financial Highlights

13 data points

Beta

Revenue

$45.22M

Net Income

$38.97M

0.9% Net Margin

EPS (Diluted)

$0.12

Total Assets

$8.37B

Cash & Equivalents

$0.00

Free Cash Flow

$0.00

Financial Statements

Beta

Revenue	$45.22M
Operating Expenses	$6.25M
Net Income	$38.97M
EPS (Basic)	$0.12
Shares Outstanding (Basic)	309.74M

Key Highlights

1The Trust's net asset value increased by 36.38% to $11.48 billion for the nine months ended September 30, 2012, compared to December 31, 2011.
2Outstanding shares increased from 563.85 million to 664.10 million, indicating strong investor inflows and creation of new shares.
3The net asset value per share saw a 15.74% increase from $14.93 to $17.28 over the nine-month period, reflecting the appreciation of gold.
4The Trust reported a net income of $127.57 million for the nine months ended September 30, 2012, a decrease from $241.21 million in the prior year's period, mainly due to lower gains on gold distributions for redemptions.
5Gold bullion inventory, valued at fair value, grew significantly from $6.63 billion at December 31, 2011, to $8.30 billion at September 30, 2012.
6The Sponsor's fees represent the primary expense, amounting to $18.02 million for the nine-month period, at an annualized rate of 0.25% of adjusted net asset value.

ISHARES GOLD TRUST Quarterly Report for Q3 Ended Sep 30, 2012

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions