GraniteShares Platinum Trust (PLTM)PLTM

ETF GraniteShares Platinum Trust: Detailed Overview

Profile:

ETF GraniteShares Platinum Trust (PLTM) is an exchange-traded fund designed to offer investors exposure to the price of platinum. The ETF invests directly in physical platinum bars, aiming to closely track the spot price of platinum, less the Trust's expenses.

Objective:

The primary investment objective of PLTM is to provide investment results that, before expenses, generally correspond to the performance of the price of platinum, as measured by the S&P GSCI Platinum Spot Index (SPT1G).

Issuer:

GraniteShares: A US-based issuer focused on offering innovative and specialized exchange-traded products.

Reputation and Reliability: GraniteShares is a relatively new issuer with a small but growing ETF portfolio. The company is backed by Granite Creek Capital Management, LLC, an experienced investment management firm.

Management: The ETF is managed by GraniteShares itself, which has a team of experienced portfolio managers and analysts with expertise in commodities and derivatives.

Market Share:

The ETF is relatively new, launched in May 2021, and has a limited market share within the Platinum ETF space, with approximately 0.2% market share as of October 2023.

Total Net Assets:

As of October 27, 2023, PLTM has total net assets of approximately $200 million.

Moat:

The competitive advantages of the ETF include:

• Direct Physical Holdings: Unlike other platinum ETFs that use swaps or futures contracts, PLTM invests directly in physical platinum bars. This offers a higher degree of transparency and potentially lower tracking error.
• Low Fees: The expense ratio of 0.40% is relatively low compared to other platinum ETFs.
• Liquidity: The ETF has a decent average trading volume, ensuring relatively easy entry and exit for investors.

Financial Performance:

Since its inception in May 2021, PLTM has closely tracked the performance of its benchmark, the S&P GSCI Platinum Spot Index. The ETF has delivered a total return of approximately 20% as of October 2023.

Benchmark Comparison:

PLTM has closely tracked its benchmark, the S&P GSCI Platinum Spot Index, with a tracking error of less than 1%.

Growth Trajectory:

The demand for platinum is mainly driven by its use in the automotive industry, particularly in catalytic converters. The growing adoption of stricter emission regulations is expected to drive the demand for platinum in the coming years.

Liquidity:

PLTM has an average daily trading volume of approximately 20,000 shares, which provides decent liquidity for investors looking to enter or exit their positions.

Bid-Ask Spread:

The average bid-ask spread for the ETF is approximately $0.05, which is relatively tight compared to other platinum ETFs.

Market Dynamics:

The platinum market is influenced by several factors, including:

• Global economic growth: Platinum demand is closely tied to economic activity, particularly in the automotive industry.
• Supply and demand dynamics: Platinum is a relatively scarce metal, with limited new discoveries. Changes in supply or demand can significantly impact prices.
• Investment demand: Platinum is also used as an investment metal, and changes in investor sentiment can affect prices.

Competitors:

Key competitors in the platinum ETF market include:

• JPMorgan Physical Platinum Trust ETF (PAAU): Market Share 9.2%
• Eurizon Physical Platinum ETF (PHPT): Market Share 8.1%
• Invesco DB Platinum Index Tracking Fund (DPT): Market Share 7.8%
• ETC Physical Platinum (XPTU): Market Share 2.4%

Expense Ratio:

PLTM has an expense ratio of 0.40%. This includes management fees, administrative expenses, and custodial fees.

Investment Approach and Strategy:

Strategy: PLTM employs a passive investment strategy, aiming to closely track the performance of the S&P GSCI Platinum Spot Index. The ETF achieves this by investing directly in physical platinum bars held in London vaults.

Composition: The ETF holds physical platinum bars, which are stored in London vaults and allocated to beneficial owners.

Key Points:

• Direct physical platinum holdings.
• Low expense ratio.
• Decent liquidity.
• Closely tracks benchmark performance.

Risks: