Q: How close does this fund track the price of gold? While writing this gold was down 1.36 % but PHYS was down 3.26 %. Clarifications?
5i Research Answer:
It depends on the gold price reference. PHYS:CA owns bullion, and most quoted gold prices are futures prices, and these can be different than spot prices. There are fees on the fund and also PHYS:CA is priced in Canadian dollars, so there is some f/x differences. PHYS:US is priced in US dollars. There are also at times bid/ask spreads depending on the market. Over a longer period, the ETFs do track gold fairly closely. Units can be exchanged for bullion, in minimum quantities (of about $400,000).