How do they make a profit? Seems too good to be true for gold buyers so it probably isn't. Gold ETF sell at a discount to the POG putting the holding company behind the 8 ball at the start. Who is auditing the gold in the HSBC vault? Look up Argentina and HSBC to find out how reliable the institution is when the chips are down. What happens if the POG goes into a tailspin. How liquid will the Gold ETF be when everyone is rushing for the door. Seems like Gold ETF will have a problem when the POG stops rising. I just fail to understand the business model from the view point of the investor and the company. Here is one link: http://goldprice.org/buying-gold/2008/09/gold-etf-how-safe-is-it-now-in-todays_18.html Finally, I would say that Gold ETFs are probably quite safe except in the case of a total meltdown and in that case there is little that will survive in paper investments. From an investment viewpoint they make little sense to me because if gold goes up $100 to $1100 you make 10%. In that scenario any gold producing miner will rise more than 10% so the obvious choice to me are miners, not gold or ETFs.
