New Gold ETF Offers You Physical Gold Redemptions

Gold’s recent surge may have slowed of late, but new ways to invest in the yellow metal continue to crop up. One of the latest offerings has been filed with the US Securities and Exchange Commission by Sprott Asset Management, which manages roughly $4.4 billion in assets.

Sprott is planning to introduce a new exchange-traded fund (ETF) called the Sprott Physical Gold Trust under the ticker symbol “PHYS” on the New York Stock Exchange. It’s designed to provide investors with exposure to the physical gold bullion market.

According to the National Post, the trust is aiming to raise up to $575 million and, though it’s much smaller, will compete with the likes of the $40.6 billion SPDR Gold Shares (GLD) ETF. The Sprott trust is marketing the ability to redeem units in the trust for actual physical gold bullion as well as a potential trust-related tax rate advantage for US investors of “15% versus 28% for the sale of collectibles held for more than one year” (the latter 28% rate is often associated with GLD).

Sprott Asset Management remains confident about the future value of gold, and “John Embury, its chief investment strategist, said recently the price could reach US$1,500 by next spring.” The story came to our attention via the National Post and the complete details are available in the preliminary prospectus filed with the SEC.