Physical Gold or Exchange Traded Fund
I’ve always said that ETFs are a great way to speculate on the price of gold… but without pointing the finger at any gold ETFs in particular, of course they are open to manipulation. It is hardly surprising that shares in a company don’t have the exact same price as the physical metal.
Even if all the physical gold is there to back the digital promises, what if there’s another 9/11… or just a tech glitch as happened on the London markets last year, and trading on the markets is suspended? Then how are you going to get your physical bullion?
The same applies to Perth Mint. If I need my gold in a hurry and air travel is suspended, I don’t want to be waiting for DHL to get my certificates to Australia to cash in.
The point for me of investing in gold is that it’s a hard asset. I don’t have to rely on brokerage accounts or Wall Street to cash it in. I’m happy to keep spare cash in the likes of GLD, but it’s pure speculation, like going to the casino. It is not a replacement for physical gold bullion.
