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seems the tax liability is also different
by Puneet Gulati on Nov 19, 2007 12:57 PM  Permalink 

as the invester is not buying any gold physically, there is no wealth tax either. please cross check this and correct.

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mathematical mistake in the article What's so good about a gold fund?
by s srinivas on Mar 05, 2005 10:20 PM  Permalink 

05 03 2005

Dear Mr Jeremy
Your article is very interesting and explained very
nicely for a layman to understand.

In the write up How the unit price is determined
the fund must have physical gold worth 100 ounces is
wrong, it should be 1000 ounces.

Since 10,000 units multiplied by 1/10 ounce = 1000 ounces,as one unit = 1/10 ounce as indicated by you.

Abroad, the practice with gold traded funds is that one unit represents one-tenth of an ounce of physical gold.

1 ounce
28.35 grammes

1 troy ounce
31.1035 grammes

So if there are investors in the fund who hold 10,000 units, that means the fund must have physical gold worth 100 ounces.

yours sincerely

S Srinivas

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