Gyroscopic Investing

I would use IAU as it's cheaper (0.25 vs. GLD's 0.40). There is also SGOL that stores gold in Switzerland, but I think it doesn't make sense to pay extra for paper products.

You asked about ETFs specifically but I would suggest considering closed end funds also. Instead of keeping all your paper gold in tax-deferred accounts you could move part of it into a taxable account and buy GTU at te same time freeing precious IRA space for tax-inefficient investments. There are some reporting requirements (need to file form 8621), but with GTU you would pay long-term capital gain tax instead of collectible tax.

Desert wrote: Thanks for the feedback.  And I should have asked about ETF's and closed-end funds.  I like the sound of IAU, with the lower expense ratio.  I'm in the process of doing an overall "tuneup" of my PP, trying to reduce expenses and counter-party risk wherever possible.

By the way, as I free up taxable money, I'm moving to physical gold with that rather than funds.  So I'm only looking for gold funds/ETF's in my tax-deferred accounts right now.

Moving to physical is a good decision. Talking about mutual funds - I can't recall if there are any pure physical gold funds, I believe there are only ETFs and CEFs. There are hybrid funds that buy miners and some bullion, but as we all know they behave more like stocks.

IAU is appealing for a tax deferred PP investor.

Honest question:  In what way is IAU less appealing than other gold ETF alternatives for taxable accounts?

Peak2Trough wrote: Honest question:  In what way is IAU less appealing than other gold ETF alternatives for taxable accounts?

I believe all gold ETFs will be less appealing than correctly reported CEFs in a taxable account due to the following reasons:

1. Higher tax rate
2. Need to report as income/pay tax on the gold sold by the fund to pay for expenses

Peak2Trough wrote: Honest question:  In what way is IAU less appealing than other gold ETF alternatives for taxable accounts?

IMHO, the only downside with IAU over the other gold ETFs is that it's a BlackRock fund, and for those who like to diversify among fund companies, it's easier to diversify with the gold component than the LTTs.  TLT is also BlackRock, but there are few (if any) good ETF substitutes. 

Tyler wrote:

Peak2Trough wrote: Honest question:  In what way is IAU less appealing than other gold ETF alternatives for taxable accounts?

IMHO, the only downside with IAU over the other gold ETFs is that it's a BlackRock fund, and for those who like to diversify among fund companies, it's easier to diversify with the gold component than the LTTs.  TLT is also BlackRock, but there are few (if any) good ETF substitutes.

How about VGLT and EDV?

Here's where I don't claim to be an expert -- I'm mainly falling back on forum knowledge here.  Perhaps I'm wrong.

My impression is that EDV is a bit too volatile, and VGLT holds up to 20% non-treasuries.  I've read here before that many really only recommend TLT as a LTT ETF option for the PP.

But that's aside from the point, anyway.  Fund diversity is still a good thing, and for some PP investors specifically looking at non-Blackrock options to avoid a TLT/SHY/IAU sweep in their portfolio is a good exercise. 

Has anyone figured out if FBAR filing is needed for over 10K of GTU, IAU, SGOL when held in taxable?  I've spent the last day searching and am still not sure.

Here are links too samples I uploaded to help filers of form 8621 and the required attachment, this is how I personally do it , note I am not an accountant also as a side note if it is held in an account in the US like Vanguard etc.  no FBAR filing is needed.

https://docs.google.com/file/d/0B8hEwPF ... s3TlU/edit

https://docs.google.com/document/d/1N5R ... JboUA/edit


As far as EDV and VGLT if you think that 20% maybe in other government backed bonds how much is this in the bigger picture, for example If you  have approx 1/3 long term bond in  TLT and the other 2/3 in  EDV and VGLT,  let say VGLT is 7% of total portfolio, so of the 7% up to 20% of it could be in other government agency bonds. Comes out to approx 1.5% of the total portfolio. These other government backed agency bonds still are very low risk and not a deal breaker the way I see it. You could just look at that 1.5% as variable portfolio.