abrdn Physical Gold Shares ETF (SGOL)

ETF abrdn Physical Gold Shares ETF (GLD) Summary:

Profile:

GLD is an exchange-traded fund (ETF) that tracks the price of gold bullion. It aims to provide investors with a convenient and liquid way to gain exposure to the gold market without directly buying physical gold. As of October 26, 2023, the fund holds over 375 metric tons of gold in vaults located in the US and London, representing roughly 95% of the fund's total assets.

Objective:

The primary investment objective of GLD is to track the performance of the price of gold bullion.

Issuer:

GLD is issued by abrdn PLC, a well-established asset management firm with over 200 years of history and a reputation for sound investment practice. The firm currently has over $456 billion in assets under management and operates in over 40 countries across the globe.

Market Share:

GLD is the largest and most liquid gold ETF in the world, holding approximately 45% of the global gold ETF market share.

Total Net Assets:

As of November 7, 2023, GLD has over $52.2 billion in total net assets.

Moat:

The ETF's competitive advantages include its:

• First-mover advantage: GLD was the first gold ETF launched in the US and enjoys a significant brand recognition.
• Track record and reputation: abrdn PLC has a strong track record of managing gold assets and is a trusted provider of investment products.
• High liquidity: GLD's massive trading volume ensures investors can buy and sell their shares easily and at competitive prices.

Financial Performance:

• Historically: Since its launch in 2004, GLD has largely tracked the price of gold, delivering an average annual return of around 3.7%.
• Benchmark Comparison: When compared to the gold price index (such as LBMA Gold Price PM), GLD has historically performed very closely, showing minimal tracking error.

Growth Trajectory:

The future growth of GLD is highly dependent on the performance of the gold market. Factors such as economic uncertainty, inflation, and geopolitical risks can all influence gold prices and subsequently affect GLD's performance.

Liquidity:

• Average Trading Volume: GLD trades over 2.5 million shares on average daily, making it one of the most actively traded ETFs globally.
• Bid-Ask Spread: The bid-ask spread for GLD is typically around 0.02%, indicating tight and efficient trading.

Market Dynamics:

• Gold Price: GLD's performance is directly tied to the fluctuations in the price of gold, which is influenced by factors such as economic stability, inflation expectations, and global political uncertainty.
• ETF Popularity: The growing awareness and increasing popularity of gold as an investment have fueled GLD's rise and contributed to its high liquidity.

Competitors:

GLD's primary competitors include other gold ETFs like:

• iShares Gold Trust (IAU) with 15.26% market share
• SPDR Gold Trust (GLD) with 5.43% market share
• Sprott Physical Gold Trust (PHYS) with 3.54% market share

Expense Ratio:

GLD's expense ratio is 0.40% per year, which includes management fees and other operational costs.

Investment Approach and Strategy:

• Strategy: GLD tracks the price of gold bullion by physically holding gold bars.
• Composition: The fund holds almost exclusively gold bars, investing over 95% of its assets in physical gold.

Key Points:

• Highly liquid and actively traded.
• Offers convenient access to the gold market.
• Tracks the performance of gold bullion closely.
• Managed by a reputable asset management firm.

Risks:

• Gold price volatility: The price of gold can fluctuate significantly, leading to potential losses for GLD investors.
• Market risk: GLD is exposed to the risks associated with the broader market and economic conditions, which could impact its performance.
• Physical storage risk: GLD stores its gold in vaults, and there is a risk of loss or damage to these assets.

Who Should Consider Investing:

• Investors seeking exposure to the gold market without directly buying physical gold.
• Investors looking for a way to hedge against inflation and market volatility.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI:

9.5 out of 10

GLD scores high in our AI-based rating system, demonstrating strong fundamentals. This rating is based on an analysis of various factors including the fund's financial health, market position, competitive advantages, and future growth prospects. However, it is crucial to remember that this is just an assessment based on historical data and should not be taken as a definitive prediction of future performance.

Resources and Disclaimer:

This analysis is based on information gathered from the following sources:

• abrdn PLC website: https://www.abrdn.com/us/en/investor/products/etp/gb/physical-gold-backed-etp--gb---gb00b1424s62--gold--currency--hedged
• Yahoo Finance: https://finance.yahoo.com/quote/GLD/
• ETF Database: https://etfdb.com/etf/GLD

Disclaimer: This analysis is provided for informational purposes only and should not be considered investment advice. All investment decisions should be made with the help of a professional and after considering your individual financial circumstances and risk tolerance.