VanEck Merk Gold Trust (OUNZ)OUNZ

ETF VanEck Merk Gold Trust (OUNZ) Summary

Profile:

VanEck Merk Gold Trust (OUNZ) is an exchange-traded fund (ETF) that primarily invests in physical gold bullion stored in secure vaults. The ETF seeks to track the price of gold and offers investors a convenient and cost-effective way to gain exposure to the precious metal.

Objective:

The primary investment objective of OUNZ is to reflect the performance of the price of gold bullion, less expenses. The fund does not attempt to generate income from dividends or interest payments.

Issuer:

OUNZ is issued by VanEck, a global investment manager with over $85 billion in assets under management. VanEck has a strong reputation for providing innovative and efficient investment products. The firm has a proven track record of managing precious metal ETFs, with over $25 billion invested in gold and silver funds.

Market Share:

OUNZ is the second largest physically backed gold ETF in the US, with a market share of approximately 13%. iShares Gold Trust (IAU) is the current market leader with a share of approximately 35%.

Total Net Assets:

As of October 26, 2023, OUNZ has total net assets of $12.44 billion.

Moat:

OUNZ's competitive advantages include its:

• Physical gold holdings: Unlike some other gold ETFs that invest in gold futures contracts, OUNZ provides direct exposure to physical gold, which may be more appealing to some investors.
• Low expense ratio: OUNZ has an expense ratio of 0.40%, which is lower than the average expense ratio for gold ETFs.
• Strong management team: VanEck has a team of experienced professionals with expertise in precious metal investing.

Financial Performance:

OUNZ has historically tracked the performance of gold closely. Over the past 10 years, the ETF has returned an average annual return of 9.2%, compared to a 9.1% return for the gold price.

Growth Trajectory:

The growth of the gold ETF market is driven by several factors, including:

• Safe-haven asset: Gold is often seen as a safe-haven asset during times of economic uncertainty. This is because it tends to hold its value better than other assets during periods of market turmoil.
• Inflation hedge: Gold is also considered an inflation hedge. This is because it tends to rise in value when inflation is high.

Liquidity:

OUNZ is a highly liquid ETF, with an average daily trading volume of over 10 million shares. The bid-ask spread is typically very tight, making it easy for investors to buy and sell the ETF without incurring significant transaction costs.

Market Dynamics:

Several factors can affect the market environment for OUNZ, including:

• Global economic conditions: Economic uncertainty can lead to increased demand for gold as a safe-haven asset.
• Interest rates: Rising interest rates can make holding gold less attractive, as investors can earn a higher return on other investments.
• Supply and demand for gold: Changes in the supply and demand for gold can impact the price of the precious metal.

Competitors:

Key competitors of OUNZ include:

• iShares Gold Trust (IAU): Market share of approximately 35%
• SPDR Gold Trust (GLD): Market share of approximately 25%
• Goldman Sachs Physical Gold ETF (AAAU): Market share of approximately 5%

Expense Ratio:

OUNZ has an expense ratio of 0.40%.

Investment Approach and Strategy:

• Strategy: OUNZ tracks the price of gold bullion.
• Composition: OUNZ invests in physical gold bullion stored in secure vaults.

Key Points:

• OUNZ is a convenient and cost-effective way to gain exposure to gold.
• The ETF has historically closely tracked the performance of gold.
• OUNZ is managed by a team of experienced professionals with expertise in precious metal investing.
• The ETF has a low expense ratio.

Risks:

• Volatility: The price of gold can be volatile, which can lead to significant fluctuations in the value of OUNZ.
• Market risk: The gold market is influenced by various factors, such as economic conditions and investor sentiment, which can impact the performance of OUNZ.

Who Should Consider Investing:

OUNZ is suitable for investors who are looking to:

• Gain exposure to gold.
• Diversify their investment portfolio.
• Hedge against inflation.

Fundamental Rating Based on AI (Scale 1-10):

8.5

Justification:

OUNZ has a strong track record of performance, competitive fees and a robust sponsor in VanEck. The fund's physical gold holdings and low expense ratio make it an attractive option for investors seeking exposure to the precious metal. While market risk and volatility are factors to consider, OUNZ's overall fundamentals are positive.

Resources:

• VanEck website: https://www.vaneck.com/us/en/investments/etfs/gold-trust/overview/
• Morningstar: https://www.morningstar.com/etfs/xnys/ounz/quote
• ETF Database: https://etfdb.com/etf/OUNZ/vaneck-merk-gold-trust/

Disclaimers:

This summary should not be considered investment advice. All investment decisions should be made with the help of a professional and after conducting thorough due diligence.