Reynold

A Guide to Gold, Silver and Platinum ETFs and ETNs

Gold ETFs like GLD are taxed at the 28% "collectibles" rate, even if you hold long term.

The Central GoldTrust of Canada (CEF) is structured as a gold holding trust. It holds audited physical gold in bank vaults. It does not promise to make physical distributions of gold under certain circumstances, as GLD does. Therefore it is not a "collectible". It qualifies as a Passive Foreign Investment Company with the IRS. You can therefore make a Qualified Electing Fund election by filing form 8621, a simple 1-page form. This allows you to receive standard capital gains treatment (15% long-term).

Many investors hold gold ETF's in an IRA to escape the onerous taxation. With CEF you can hold some gold in a regular brokerage account without getting killed at tax time.

Also, the auditing is much more transparent than that of GLD.

Lehman Bros. Enters the ETN Market with 'Opta' Commodities, Private Equity

Gosh, top ratings from S&P and Moody's--how reassuring! The risk of Lehman Bros. going bankrupt may be "small", but the default risk here has to be somewhat less small. ETN's backed by a brokerage house? Sorry, no thanks!

Claymore Fund Closings Not Good for ETF Industry

You may "believe you're write," but your being right is not at all convincing. You are defending the indefensible. The "industry" has slung hundreds of funds out there, and only a few of them are "great products". Many are just niche garbage. Die, ETFs, die!

ETF Update: Waiting On China's Currency Release, Less Than Green ETFs, Getting ETFs Into 401(k)s

"Investing in China's yuan doesn't have an easy or direct path"? Oh yes it does! You can purchase a CD denominated in Chinese yuan (renminbi) from Everbank. It's listed under Products > Foreign Currencies > Worldcurrency Access Deposit Account > View Currency Rates. It does not pay interest.

Ben Stein, Global ETFs and The Dollar

Is it possible that Stein is saying that the stocks the ETFs invest in, and not the ETFs themselves, are denominated in foreign currencies? I think he meant that these ETFs are non-dollar-hedged, so their returns will be affected by swings in foreign currencies. Which has happened to great positive effect the last several years, as the dollar has fallen.

The biggest, and most foolish, macro bet one can make on the future of the dollar is to put all one’s eggs in dollar and dollar-hedged baskets. Instead, one should link one’s investments proportionally to the entire global wealth, and thereby to a basket of major currencies. This is not speculation. It is diversification. Over the long term, even though currencies will rise and fall, results will probably be better than patriotically betting on one’s homeland currency. Lucky is the rare investor who has the foresight and skill to pick the single currency that will win the long-term race. Otherwise, holding assets in various currencies, by investing around the world, in proportion to GDP or market cap, will help insure against financial ruin.