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If Asia shuns U.S. dollar, bonds will crash
By Zachary Howard
Reuters
Thursday, January 27, 2005
http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=7456774
NEW YORK -- A new U.S. gold exchange-traded fund,
iShares COMEX Gold Trust, will make its long-awaited
debut on the American Stock Exchange on Friday
under the ticker symbol IAU, Barclays Global Investors
said on Thursday.
"We heard from the U.S. Securities and Exchange
Commission late last night that we are effective with
our gold product and we're scheduled to launch
tomorrow," said a Barclays spokeswoman.
In a posting on its Web site, the Amex also said
iShares Gold was expected to begin trading Friday.
When it lists, the ETF will be the second U.S. gold
security that can be traded like any stock on an
exchange. The first one in the United States,
StreetTRACKS Gold Trust (GLD), which is backed
by bullion, made a smash debut on the New York
Stock Exchange in November and has amassed
more than $2 billion in value.
Gold ETFs are designed to reflect the price of the
precious metal, and have been aimed at drawing the
investment capital that helped lift bullion to a
16-year high above $456 an ounce late last year.
Similar funds have launched in Australia, South Africa,
and Britain but have not matched the value of the first
such U.S. offering.
Barclays filed a registration with the SEC for iShares
COMEX Gold early in 2004. Each share in the fund
will correspond to one-tenth of a Troy ounce of gold.
The ETF's trustee, the Bank of New York, will oversee
its day-to-day operations. The bank will set the net
asset value daily, based on the settlement price for
spot-month gold futures on the New York Mercantile
Exchange's COMEX division, less the trust's
expenses and liabilities.
Barclays Capital, a leading bullion market player, will
be the initial buyer of shares issued by the trust,
purchasing 150,000 shares -- equal to 15,000 ounces
of gold -- according to an SEC filing.
"The news is interesting, but they also only put 15,000
ounces into the depository, and that is really minor
compared to the other ETF," said one precious metals
analyst.
Holdings of bullion in StreetTRACKS amounted to about
4.9 million ounces, or 152 tonnes, as of Jan. 26.
The custodian in iShares Gold will be the Bank of Nova
Scotia, which has storage capabilities in New York,
London, and other locations worldwide.
COMEX benchmark February gold closed Thursday
down 60 cents at $426.30 an ounce.
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