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New Gold Fund Starts Trading on AMEX.
Barclays Global Investors iSHARES COMEX Gold Trust, the second U.S. gold ETF, was launched this past Friday, trading on AMEX under the symbol "IAU".
The trustee is The Bank of New York and the custodian is The Bank of Nova Scotia, according to documents filed with the SEC.
SEC filings reveal that the shares will be sold in blocks of 50,000. iShares will be offered at prices that will reflect, among other things, the price of gold and the trading price of the iShares on the AMEX at the time of the offer. The objective of the trust is for the value of the iShares to reflect price of gold owned by the trust at that time, less the trust's expenses and liabilities.
On January 21, 2005, Barclays Capital Inc deposited into the trust 15,000 fine ounces of gold as consideration for three initial baskets comprising 150,000 iShares with a per-iShare purchase price of 1/10th of a fine ounce of gold. As of the close of business on January 21, 2005, the net asset value of the trust was $6,400,500 and the NAV was $42.67.
The Barclays product will compete with the streetTracks Gold Trust (GLD) which was launched in November 2004 on the NYSE. The first day of trading for GLD attracted $550 million into the fund. StreetTracks is the brand new of several ETFs managed by State Street Global Advisors.
Gold ETF shares are aimed at overcoming the logistics of buying, story and insuring gold. Institutional and retail investors, including pension funds, which were not allowed to participate in the gold market are allowed to buy gold-backed shares from the trust.
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