Goldor silver? Platinumor palladium? How do investors make a decision as to which precious metal is the appropriate choice for portfolio diversification purposes?
Rising rates could spell good news for precious metals. That’s because a stronger economy drives the need for manufacturing components, many of which rely on platinum, palladium, and silver. And, a stronger economy boosts jewelry sales, which accounts for half gold’s annual demand.*
* International Gem Society
Disclosure
The ETFS Silver Trust, ETFS Gold Trust, ETFS Platinum Trust, ETFS Palladium Trust and Precious Metals Basket Trust are not investment companies registered under the Investment Company Act of 1940 or a commodity pool for purposes of the Commodity Exchange Act. Shares of the Trusts are not subject to the same regulatory requirements as mutual funds. These investments are not suitable for all investors. Trusts focusing on a single commodity generally experience greater volatility.
The value of the Shares relates directly to the value of the precious metal held by the Trust and fluctuations in the price could materially adversely affect investment in the Shares. Several factors may affect the price of precious metals, including: (1) A change in economic conditions, such as a recession, can adversely affect the price of the precious metal held by the Trust. Some metals are used in a wide range of industrial applications, and an economic downturn could have a negative impact on its demand and, consequently, its price and the price of the Shares; (2) Investors’ expectations with respect to the rate of inflation; (3) Currency exchange rates; (4) Interest rates; (4) Investment and trading activities of hedge funds and commodity funds; and (5) Global or regional political, economic or financial events and situations. Should there be an increase in the level of hedge activity of the precious metal held by the trust or producing companies, it could cause a decline in world precious metal prices, adversely affecting the price of the Shares. Should there be an increase in the level of hedge activity of the precious metal held by the Trusts or producing companies, it could cause a decline in world precious metal prices, adversely affecting the price of the shares.
Commodities and futures generally are volatile and are not suitable for all investors. Shares in the Trust are not FDIC insured and may lose value and have no bank guarantee.
Investors buy and sell shares on a secondary market (i.e., not directly from trust). Only market makers or “authorized participants” may trade directly with the fund, typically in blocks of 50k to 100k shares. The Fund’s net asset value per share (NAV) is calculated by dividing the value of the Fund’s total assets less total liabilities by the number of shares outstanding. Market Price returns are based on the bid/ask spread at 4 p.m. ET and do not represent the returns an investor would receive if shares were traded at other times.
Carefully consider the fund’s investment objectives, risk factors, and fees and expenses before investing. For further discussion of the risks associated with an investment in the funds please read the prospectus at www.etfsecurities.com/etfsdocs/USProspectus.aspx. Or visit the ETF Securities website: www.etfsecurities.com.
Diversification does not ensure a profit nor protect against loss.
ALPS Distributors, Inc. is the marketing agent for ETFS Silver Trust, ETFS Gold Trust, ETFS Platinum Trust, ETFS Palladium Trust and ETFS Precious Metals Basket Trust