This information should be read in conjunction with the financial statements and notes to the financial statements included with this report. The discussion and analysis that follows may contain statements that relate to future events or future performance. In some cases, such forward-looking statements can be identified by terminology such as "may," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or the negative of these terms or other comparable terminology. We remind readers that forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future results, performance, levels of activity, or our achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Trust undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Introduction.
The
The Trust is a passive investment vehicle and the objective of the Trust is for the value of each Share to approximately reflect, at any given time, the price of the gold bullion owned by the Trust, less the Trust's liabilities (anticipated to be principally for accrued operating expenses), divided by the number of outstanding Shares. The Trust does not engage in any activities designed to obtain a profit from, or ameliorate losses caused by, changes in the price of gold.
The Trust issues and redeems Shares only in exchange for gold, only in
aggregations of 50,000 or integral multiples thereof (each, a "Basket"), and
only in transactions with registered broker-dealers or other securities market
participants not required to register as broker-dealers, such as a bank or other
financial institution, that (1) are participants in DTC and (2) have previously
entered into an agreement with the Trust governing the terms and conditions of
such issuance (such dealers, the "Authorized Participants"). As of the date of
this annual report the Authorized Participants that have signed an Authorized
Participant Agreement with the
29
Shares of the Trust trade on the NYSE Arca under the symbol "BAR".
Investing in the Shares does not insulate the investor from certain risks, including price volatility. The following graph illustrates the movement in the net asset value ("NAV") of the Shares against the corresponding gold price (per 1/100 of an oz. of gold) since inception:
NAV per Share(1) vs. 1/100th gold price from
[[Image Removed]]
(1) Adjusted for effect of stock split. The stock split was effective on
Source: Bloomberg
The divergence of the NAV per Share from the gold price over time reflects the cumulative effect of the Trust expenses that arise if an investment had been held since inception.
Critical Accounting Policy
The financial statements and accompanying notes are prepared in accordance with
accounting principles generally accepted in
Valuation of Gold
Gold is held by the Custodian on behalf of the Trust. Gold is recorded at fair value. The cost of gold is determined according to the average cost method and the fair value is based on the LBMA PM Gold Price. Realized gains and losses on transfers of gold, or gold distributed for the redemption of Shares, are calculated on a trade date basis as the difference between the fair value and cost of gold transferred.
June 30, 2021
(Amounts in 000's of US$)
Investment in gold - cost $ 878,799
Unrealized gain / (loss) on investment in gold 130,805
Investment in gold - fair value $ 1,009,604
30
Inspection of Gold
Under the Custody Agreements, the Trustee, the Sponsor and the Sponsor's auditors and inspectors may, only up to twice a year, visit the premises of the Custodian for the purpose of examining the Trust's gold and certain related records maintained by the Custodian.
The Sponsor has exercised its right to visit the Custodian in order to examine
the gold and the records maintained by them. The most recent inspection by
Liquidity
The Trust is not aware of any trends, demands, conditions or events that are reasonably likely to result in material changes to its liquidity needs. In exchange for a fee (the "Sponsor's Fee"), the Sponsor has agreed to assume most of the expenses incurred by the Trust. As a result, the only expense of the Trust during the period covered by this report was the Sponsor's Fee. The Trust's only source of liquidity is its transfers and sales of gold.
The Trustee will, at the direction of the Sponsor or in its own discretion, sell
the Trust's gold as necessary to pay the Trust's expenses not otherwise assumed
by the Sponsor. The Trustee will not sell gold to pay the Sponsor's Fee but will
pay the Sponsor's Fee through in-kind transfers of gold to the Sponsor. At
Review of Financial Results
Financial Highlights
June 30, 2021
(Amounts in 000's of US$ except per share data)
Total gain / (loss) on gold $ (9,997 )
Change in net assets from operations $ (12,009 ) Net increase (decrease) in net assets per share $ (0.19 )
Fiscal year ended
The Trust's NAV decreased from
The NAV per Share decreased 0.46% from
Fiscal year ended
The Trust's NAV increased from
The NAV per Share increased 25.28% from
31
Fiscal year ended
The Trust's NAV increased from
On a post stock split basis (see Note 1 to the Financial Statements), the NAV
per Share increased 12.50% from
Off-Balance Sheet Arrangements
The Trust is not a party to any off-balance sheet arrangements.
© Edgar Online, source
