GLD tracks the spot price of gold, minus expenses and liabilities, using gold bars found in London vaults. The SPDR Gold Shares (GLD) ETF tracks the price of gold bars on the OTC market. Gold is a precious metal commodity and many investors want to keep physical gold as a protection against the general decline in economic conditions and against inflation, while some may use it as a method of diversifying portfolios. In 2004, the launch of the publicly traded fund SPDR Gold Trust, with the symbol GLD, equalized the conditions for investment in gold by allowing a cheaper option than buying physical metal.
Additionally, Gold for IRA investment is becoming increasingly popular as investors look for ways to diversify their retirement portfolios. Regular shareholders are not entitled to reimbursement and gold is not required to be insured by the Trust, which is not responsible for loss, damage, theft or fraud. The trust seeks to reflect the evolution of gold bullion prices by holding gold ingots and issuing shares backed by their physical metal holdings. GLD tracks the price of gold by holding gold bars in a trust in the form of 400-ounce London Gold Delivery ingots, deposited in an assigned account. Investing in gold ETFs is a cost-effective and easy way to expose yourself to gold, and the SPDR Gold Shares (GLD) ETF is one of many ETFs that offer this exposure.
Eventually, gold recovered, but the bank that held it was able to continue operations normally by borrowing gold from elsewhere. In the case of the GLD, HSBC has an account in the name of the Bank of New York that contains uniquely identifiable gold bars and separates them from any other gold it holds for other customers.
