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Asian Gold-Backed ETF Shutters


ETF Securities is closing down its Asia physically backed gold exchange traded, but investors can still track the bullion market with the fund sponsor’s other option.

According to a press release, the ETFS Physical Asian Gold Shares (AGOL) will be terminated at the end of trading on August 12, 2015. The firm made the first announcement in July.

AGOL still held about $11.0 million in assets under management as of August 12, so some investors are still holding onto the ETF.

Under the Trust Agreement, shareholders may tender their Shares for redemptions electronically through the facilities of the Depository Trust Company to The Bank of New York Mellon until November 10, 2015. Shareholders may then receive the amount of unallocated gold represented by the tendered Shares.

A tendering shareholder may also incur a fee, charges and taxes, including a $500 transaction fee.

On the other hand, if you are still holding on to AGOL after November 11, the Trust will sell the remaining gold holdings in U.S. dollars and distribute it to shareholders based on the number of shares held. Transaction costs will be incurred by the Sponsor, but tendering shareholders will be subject to fees.

As of August 12, AGOL held about 9,823 troy ounces of gold, with 100,000 shares outstanding.

AGOL, like other popular gold ETF plays, was backed by physical gold bars. However, AGOL was unique in the sense that it held its gold bullion in vaults located in Singapore, which provided another way for investors to diversify their gold holdings.

Nevertheless, investors may still trade the larger ETFS Physical Swiss Gold Shares (SGOL) , which has $841.9 million in assets under management. SGOL holds gold bullion stored in vaults located in Zurich, Switzerland.

Other physically backed gold ETFs hold bullion in separate locations. For instance, the SPDR Gold Shares (GLD) and the iShares Gold Trust (IAU) hold bullion stored in London.

For more information on the ETF industry, visit our current affairs category.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.