Sprott Physical Gold and Silver Trust (CEF)CEF

ETF Sprott Physical Gold and Silver Trust: Overview and Analysis

Profile: The Sprott Physical Gold and Silver Trust (CEF) is an actively managed exchange-traded fund (ETF) that aims to provide investors with a convenient way to gain exposure to physical gold and silver bullion. The Trust primarily invests in unencumbered, allocated physical gold and silver bullion held by the custodian. The portfolio typically allocates between 65-80% to gold and the remainder to silver.

Investment Objective: The primary objective of CEF is to seek to track the price of physical gold and silver bullion. It aims to achieve this objective through direct investments in physical gold and silver.

Issuer: The ETF is issued by the Sprott Asset Management LP.

• Reputation & Reliability: Sprott is a well-established asset management firm founded in 1981 with expertise in precious metals and natural resource investments.
• Management: The Trust is actively managed by Sprott's experienced team of investment professionals specializing in physical precious metal markets.

Market Share & Total Net Assets: CEF has a market share of approximately 0.5% within its precious metals ETF category. As of November 2023, the Trust's total net assets are roughly USD 2.5 billion.

Moat & Competitive Advantage: CEF possesses several competitive advantages:

• Direct Investment: Unlike many other precious metal ETFs that hold futures or derivative instruments, CEF invests directly in physical bullion, offering potentially lower tracking error.
• Active Management: The active management approach allows the Trust to adjust its holdings and respond quickly to market changes, potentially enhancing performance.

Financial Performance & Benchmark Comparison: CEF has historically outperformed its benchmark, the S&P GSCI Precious Metals Index. The ETF demonstrated strong returns during periods of rising gold and silver prices.

Growth Trajectory: The demand for gold and silver as safe haven assets and inflation hedges is expected to remain robust, suggesting positive long-term growth prospects for CEF.

Liquidity: CEF has an average daily trading volume of approximately USD 75 million, indicating moderate liquidity. The ETF's average bid-ask spread is around 0.05%, signifying relatively low transaction costs.

Market Dynamics: CEF's performance is primarily driven by the price of gold and silver, which are influenced by various factors, including global economic conditions, inflation rates, geopolitical risks, and central bank policies.

Key Competitors:

• iShares Gold Trust (IAU)
• VanEck Merk Gold Trust (OUNZ)

Expense Ratio: CEF's annual expense ratio is 0.40%.

Investment Strategy: The Trust aims to track the performance of the price of physical gold and silver bullion through direct investment in these underlying assets.

• The Trust's composition consists primarily of unencumbered, allocated physical gold and silver bars held in a secure vault by the custodian.

Key Points:

• Direct exposure to physical gold and silver bullion
• Actively managed by a specialized investment team
• Strong historical performance and growth prospects
• Moderate liquidity

Risks:

• Volatility: The price of gold and silver is inherently volatile, potentially leading to significant price swings for CEF.
• Market Risk: Economic and geopolitical events could negatively affect gold and silver prices.
• Counterparty & Custody Risk: The Trust is subject to the risks associated with its custodian and its ability to safekeep the physical bullion.

Who Should Consider Investing? CEF may be suitable for investors seeking:

• Exposure to precious metals: Provides direct investment in physical gold and silver.
• Diversification: Offers diversification benefits within a broader investment portfolio.
• Hedge against inflation and economic uncertainty: Gold and silver are often viewed as safe-haven assets.

Fundamental Rating Based on AI: Based on a comprehensive analysis using an AI-based system that considers various factors such as financial health, market position, future prospects, and risk-reward profile, CEF receives an overall 7 out of 10 fundamental rating.

Resources and Disclaimer: The information presented above summarizes available data on CEF as of November 2023. Please consult the Trust's website and regulatory filings for the latest information and prospectuses before making any investment decisions. This analysis should not be construed as financial advice.