SPDR Gold Trust, also known as SPDR Gold Shares, offers investors an innovative, relatively cost efficient and secure way to access the gold market. It is one of the most popular ETFs in the world, tracking the price of gold bullion in the over-the-counter market. The Trust holds gold bars and from time to time, issues Baskets in exchange for deposits of gold and distributes gold in connection with redemptions of Baskets. The physically-backed nature of this product eliminates any of the uncertainties introduced through futures-based strategies. Gold is a precious metal commodity and many investors want to hold physical gold as a hedge against an overall decline in economic conditions as well as against inflation, while some may use it as a method of portfolio diversification.
SPDR Gold Shares is one of the top ten largest holders of Gold in the world, and is the largest physically-backed Gold ETF in the world.
This ETF denotes a share of gold bullion, unlike many ETFs which represent ownership in a basket of stocks.
GLD tracks the price of gold by holding gold bullion in a trust kept in the form of London gold Delivery bars of 400 ounces, held in an allocated account. The physical gold is held by the custodian in a vault in London or in the vaults of other sub-custodians.
It also trades on the Singapore Stock Exchange, Tokyo Stock Exchange, The Stock Exchange of Hong Kong and the Mexican Stock Exchange (BMV).