Morningstar Review of SGOL
Posted: Sun Sep 23, 2012 7:42 pm
Again, this is from Morningstar's analysis, to give credit where credit is due.A share of ETFS Physical Swiss Gold Shares SGOL represents a 0.1-ounce ownership stake in gold bullion held in subcustodian UBS AG's vaults in Switzerland. Switzerland's independence and centuries-long history as trusted stewards undoubtedly appeal to investors worried about the safety of claims on gold held in New York or London vaults by the other big gold exchange-traded funds--iShares Gold Trust IAU and SPDR Gold Shares GLD. However, the added safety is illusory. The ETF's shares are issued in the United States, its primary custodian is J.P. Morgan Chase (the same as IAU's custodian), and the independent audits are conducted by Inspectorate International Ltd., the same firm that inspects bullion held for GLD and IAU. They all rely on American rule of law to enforce ownership claims and use the same auditor, so worrywarts should focus on real issues.