Gold in US$'s per ounce Fed Funds futures price (-the rate) Mike McGlone Head of Research US Mike.mcglone@etfsecurities.com ETF Securities Precious Metals Quarterly Q1 215 GOLD REMAINS RESILIENT FACING INCREASING UNCERTAINTY - Gold remained unchanged despite anticipated Federal Reserve (Fed) tightening and the strong US dollar. - The correlation between Fed Funds futures and gold neared the highest ever. - Silver was the best performer 1 staying unusually calm in the face of a spike in currency volatility. - Platinum and palladium appear fundamentally undervalued. - Precious metals were the best performing commodity sector 2 in Q1. Gold remains resilient Many central banks unexpectedly cut rates in Q1, addressing deflationary risks which bid currency volatility and supported the US dollar. Gold, in terms of the Euro currency, increased 12.7%, but in the US dollar it remained essentially unchanged as the US Dollar Index gained 9% and crude oil declined 11%. Silver proved the most resilient, gaining 6% despite looming Fed tightening. The Swiss National Bank threw in the towel trying to support the Euro. The European Central Bank (ECB) committed to providing liquidity until inflation is firmly in place. These were notable support factors, in addition to the prospect of reduced gold investment restrictions in India. Exemplifying underlying gold strength and a primary factor affecting the gold price, gold gained when measured in most other currencies (table below). Despite a 15% gain in the US Dollar Index over the past 6-months, gold in USD has declined only 3%. The Federal Open Market Committee (FOMC) meeting announcement on March 18th appeared to put a top in the high velocity US dollar rally, at least in the near term. If this turns out to be a longer-term US dollar top, and/or stock market volatility normalizes (the two have the potential to be closely correlated) gold should be likely to recover from near the US$1,2/oz. level and potentially revisit the upper-end of the 2- year range near US$1,4/oz. End of Q1 6-Months 12-Months 24-Months Q1 Change Chg Chg Chg Gold (US$'s per ounce) $ 1,183.6 -.1% -2.7% -7.8% -25.9% Silver $ 16.7 +6.% -4.8% -15.8% -41.2% Platinum $ 1,141.9-5.5% -12.7% -19.4% -27.3% Palladium $ 736.2-7.7% -6.9% -5.2% -4.6% Basket (index) $ 735.1-2.5% -5.2% -9.4% -22.7% Related Markets S&P 5 Index 2,68 +.4% +4.6% +.4% +31.8% US Dollar Index 98.4 +9.% +14.9% +22.8% +18.5% yr yield (percent) 1.92% -11.4% -22.4% -29.2% +4.% Fed Funds Future Price (12th) 99.49 +.% -.1% -.3% -.4% Crude oil (US$'s per barrel) 47.6 -.6% -49.7% -53.1% -51.% Total Known Global ETF Holdings (millions of ounces) Gold 52.1 +1.4% -4.1% -7.9% -33.8% Silver 62.3 -.4% -3.8% -2.5% -1.9% Platinum 2.7-2.5% -3.4% +3.8% +68.% Palladium 2.9-5.9% -1.2% +36.5% +28.8% Gold in Various Currencies Gold / Euro 1,3 +12.7% +15.1% +18.3% -11.5% Gold / Yen 142,184 +.3% +6.8% +7.3% -5.5% Gold / British Pound 799 +5.1% +6.7% +3.7% -24.% Gold / Indian Rupee 73,743-1.5% -1.6% -4.9% -15.2% Gold / Chinese Renminbi 7,339 -.2% -1.8% -8.1% -26.1% Based on 3/31/215 NY end-of-day spot levels. Source: ETF Securities, Bloomberg. Platinum and Palladium (PGMs) suffer 12 Global economic concerns pressured platinum and palladium in Q1 they declined 5.5% and 7.7%, respectively. However, in our view, the PGMs are fundamentally undervalued. They were pressured in Q1 on the back of the strong US dollar, weakening global economic conditions and improving production from South Africa (the primary producer) in the aftermath of the 214 strikes. The more industrial demand focused PGMs appeared to be caught in the downdraft of the global commodity plunge. However, precious metals (PMs) were the best performing commodity sector in Q1 with a decline of about 2.5% (as measured by a precious metals basket) compared to the 6% decline in the Bloomberg Commodity Index (BCOM) Gold has been declining along with increasing Fed rate hike expectations $1,4 Spot gold (lhs).3 $1,35 $1,3 $1,25 $1,2 $1,15 Source: ETF Securities, Bloomberg. Weekly data from 1/1/214 thru 3/31/215 Fed Funds futures (12th contract, rhs) $1, Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Gold - all about the Fed Fed funds futures are among the most transparent market indicators of Fed tightening expectations. Historically, the correlation between the price of gold and Fed funds futures has been slightly positive on a day-to-day basis. However, in Q1 215, the correlation reached near the highest in Fed Funds futures history;.8 on a weekly basis (between gold and the 12 th futures contract). Granted there were only 14-weeks, but the trend has been clear as depicted in the chart above. Historically, Fed tightening cycles have coincided with increasing inflation, but 1 Silver gained 6% in Q1. The other precious metals declined. 2 Based on the Bloomberg Commodity Index sector returns..1 99.9 99.7 99.5 99.3 99.1
Fed funds interest rate yr Yield in percent USD index volatility, percent annual Silver price volatility, percent annual 2 Precious Metals Quarterly ETF Securities contrary to many assumptions, tightening cycles generally have also coincided with higher gold prices. More recently, Fed tightening rhetoric has clashed with policies at most other central banks which are more focused on deflation risks, declining bond yields and a strong US dollar. This has weighed on gold prices but the Fed appears to have relatively little actual inflation ammunition to pull the trigger on rate hikes. Gold has performed well during Fed tightening cycles FOMC Tightening Cycles and the Change in the Price of Gold FOMC 1-Yr Gold price change upon Gold price change 3-months Gold price change a year Gold price change over Tightening Cycle initial tightening after initial after initial entire cycle 1 12/1976-5/1981-4% + 11% + 23% + 256% 2 12/1986-6/1989 + 19% + 8% + 25% - 4% 3 2/1994-6/1995 + 16% + 1% - 1% + 1% 4 6/1999-12/2-12% + 14% + % + 4% 5 6/24-8/27 + 14% + 6% + % + 71% Average + 7% + 8% + 13% + 66% Source: Bloomberg, ETF Securities. End of month data from 12/1/1975 thru 3/27/215. Tightening cycles measured from the first target fed funds increase to the month prior to the next ease. The Fed Vs the bond market Inflation expectation is the primary factor affecting riskless US bonds. If the bond market is not worried about inflation, why is the Fed? The yr note ended Q1 with a yield of 1.92%. The Consumer Price Index (CPI) for February showed annual inflation of.% for a real rate near 2% (yr yield less CPI) which is about double the year average. June 24 marked the last time the Fed started a tightening cycle. At that time, the yr yield was above 4%, CPI was above 3% and both were trending higher. Similar levels and upward trends are a dream today. At a minimum, the yr yield probably needs to sustain above 3% before the Fed should begin worrying about inflation. What inflation? The trend in bond yields remains down 9 8 7 6 5 4 3 2 1 Source: ETF Securities, Bloobmerg, Weekly data from 1/2/199 thru 3/31/215. Fed Funds Rate yr Yield 199 1994 1998 22 26 2 214 Fed misfire risk increases uncertainty There is no clear path, said Fed Vice chair Stanley Fischer in March. Investors should be prepared for the potential volatility a Fed misfire might have on financial markets. The ECB misfired in 211 and is now focused on Quantitative Easing (QE). The risk of a Fed rate hike misfire is quite high with almost 5 million people on food stamps (double the 24 level) and the gross debt to GDP (Gross Domestic Product) ratio above %, compared to 6% in 24. At the beginning of 214, increasing bond yields and commodity prices were consensus views. What did that consensus miss that they might be missing now? The market may not conform to the latest Fed tightening consensus which could benefit Precious Metals (PMs) prices, notably gold and silver. 9 8 7 6 5 4 3 2 1 Silver appears cheap Silver rebounded in Q1 as currency volatility reached the highest since the downgrade of the US Debt in 211 - the year when silver topped near US$5/oz. Known in many languages as money and often trading like leveraged gold, silver price volatility has a history of trending in a similar pattern with currency volatility. Recently, however, silver has stayed unusually calm within a US$16/oz. to $17/oz. range. Silver has remained unusually calm despite increasing currency volatility 2% 125% US Dollar index volatility (lhs) 16% 12% 8% 4% Silver price volatility (rhs) Source: ETF Securities, Bloomberg. Data from 1/2/28 thru 3/31/215. Volatility measure is 3-day annualized. % 28 29 2 211 212 213 214 215 % 75% 5% 25% During the past 12-months, silver has declined 16% as the US Dollar index has increased 23%. However in Q1, silver showed divergence as the best performing PM despite continued strength in the US dollar. At the end of 214, silver appeared quite inexpensive, dipping to near US$15/oz., which is near many estimates of the marginal cost of production. Because most silver mine supply is a by-product from the production of other metals (gold, lead, zinc and copper), production cost estimates are more difficult to determine but most all-in costs of production are closer to US $19-$2/oz. The 214 average silver price was US$19/oz. so US$19-$2/oz. is a likely resistance area. Supply demand trends appear favorable Near record Chicago Mercantile Exchange (CME/COMEX) silver inventories in Q4 pressured prices. By the end of Q1, CME/COMEX silver inventories declined about 4% from the September peak. Total silver supply will likely continue to decline in 215 notably due to the sharp drop in recycled silver on the back of lower prices. The CPM Silver Yearbook 214 projected a.7% decline in total silver supply in 214, led by a projected 6.5% decline in secondary supply. The 16% silver price decline over the past 12-months should further reduce this more price elastic silver supply source, recycling. In addition, lower prices should continue to entice increasing demand for one of the best conductors of electricity. Industrial fabrication and investment are the largest and most rapidly growing silver demand sources, together accounting for about 7% of total demand in 214. Industrial demand is less elastic to price changes and has been steadily increasing, as the world becomes more dependent on electronics. Investment demand has been steady lately compared to gold and has the potential to accelerate with the gold to silver price ratio near multi-year highs. Despite a 34% decline in total gold exchange traded fund (ETF) holdings over the past two years; silver ETF holdings have basically flat-lined, dropping 1.9% over that time frame. In both 213 and 214, US Mint silver coin %
2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 Platinum US$'s per ounce Gold divided silver ratio US$'s per Euro currency Percentage of total demand 3 Precious Metals Quarterly ETF Securities sales reached new records of 43 million (mn) and 45mn ounces respectively. To put that in context, US miners produce only about 35mn ounces of silver annually and the US Mint must obtain its silver from US sources. US Mint silver sales declined a bit in Q1 from the record pace of the past two years but the trend seems intact, as investors appear to be responding positively to lower prices. Industry and investment are the largest demand sources 6% 5% 4% 3% 2% % % World Silver Demand Identifiable Investment Industrial Fabrication The gold/silver ratio may be topping. In 27 prior to the crisis, the gold/silver ratio averaged near 52. In December, it reached 76, the highest level since the 28 crisis. Near 71 at the end of Q1, the gold/silver ratio is more likely to decline unless prompted by a stumble in the global economy. The gold / silver ratio 9 Gold/Silver Price Ratio 8 7 6 24 Actual 214 Estimate Source: ETF Securities, GFMS Thompson Reuters. Data from 1/1/24 thru 11/3/214 Jewelry Photography Silverware demand. It appears to be recovering with some help from QE and there is likely plenty of pent-up demand following the long recession in sales. Platinum and palladium will likely remain in deficit As a percentage of demand Palladium in a Deficit for the 3rd Year in a Row As % of Demand, From 24 to 214E* Percent 2% % % -% -2% -5.4% -.3% 13.8% 5.6% -11.5% -4.1% -7.7% Palladium -.7% Platinum -13.3% -15.4% 2 211 212 213 214E* Source: Source: JohnsonETF Matthey, Securities, GFMS, ETF Securities Johnson Matthey, GFMS. Data from 1/1/2 thru 12/31/214 * JM forecasts as of November 214 We estimated the marginal cost of production for platinum near US$1,4/oz. in 214. With the decline in the price of crude oil, it is closer to US$1,3/oz., about the Q1 ending level of the 2- day moving average (dma, see analytics beginning on page 5). Sustaining below US$ 1,3/oz. is unlikely long-term as most estimates place the all-in cost for platinum closer to US$1,7/oz. In addition, being priced below gold should spur demand in China for jewelry - the second largest source of platinum demand. China platinum imports (a good indicator of jewelry demand) declined to 2.5million ounces in 214 (about 38% of total annual global supply). Due to the decline in the platinum price, China imports are likely to increase in 215. Platinum prices have been pressured by the plunging Euro $1,9 Platinum spot (lhs) Euro spot (rhs) $1.5 5 $1,7 $1.4 4 3 Source: ETF Securities, Bloomberg.Data rom 1/2/2 thru 3/31/215 $1,5 $1,3 $1.3 $1.2 Platinum and palladium fundamentally undervalued. Concerns over a potential slowdown in demand weighed on platinum and palladium prices in Q1. The extensive use of platinum and palladium in vehicle catalytic converters makes demand particularly sensitive to global economic, industrial and market conditions. Although the deficit should narrow this year, platinum and palladium will likely remain in supply demand deficits while strike risk remains high in South Africa. Platinum has declined the past few years due to recessionary conditions in Europe and the plunging Euro currency. With an end of Q1 price of US $1,142/oz., platinum appears undervalued with the potential to be a primary beneficiary from QE in Europe. Historically, when platinum has traded below the price of gold, platinum has had a tendency to rally. The European auto market is a primary source of platinum $1, Source: ETF Securities, Bloomberg. Weekly data from 1/1/211 thru 3/31/215 $9 211 212 213 214 215 $1.1 $1. Palladium declines on economic concerns In addition to global economic concerns and some investor profit taking, palladium declined in Q1 on the back of a drop in China imports. China palladium imports, which absorbed about 9% of total annual palladium supply in 214, declined 38% in the first two months of 215 from the same period a year ago. However, China and US auto sales (the two largest auto markets) remained strong in Q1 so it is likely stockpiles have been reduced. The China Association of Automobile Manufacturers expects auto sales in the country to rise by 8% to 21.3 million vehicles in 215. We expect palladium to continue to outperform platinum. While
S&P 5 Index Palladium v. gold ratio S&P 5 Index value Gold price in US$'s per ounce Palladium price in US$'s per ounce China auto sales in millions 4 Precious Metals Quarterly ETF Securities we believe that the platinum price will return to trade above the US$1,3/oz. level as Chinese demand recovers and Eurozone auto subsidies kick in, palladium appears to be in a better position to benefit from a pick-up in China and US economic growth. Demand for catalytic converters is likely to remain strong in 215. Palladium has trended higher with China auto sales $1, 25 Palladium spot price (lhs) $8 $6 $4 $2 $- Millions of ounces 25 26 27 28 29 2 211 212 213 214 Silver 81 8% -4.4% -4.3% -5.9% -14.1% Platinum 2.3 35% -12.2% -17.5% -29.9% -7.9% Palladium.7 8% -9.5% -16.6% -3.4% +.4% Source: ETF Securities, Bloomberg. The data is the latest available as of 3/31/215. All analysis done on the 12-month sum of China imports. 1-2/28/215 is the latest monthly data available. 2 - Of 214 estimated supply from CPM Group. The palladium Vs gold ratio has been trending consistently along with the S&P 5, until recently. Gold has historically been a primary alternative diversification asset and palladium is the more global industrial demand related PM. Since the gold peak in 211, gold and the S&P 5 have generally trended in opposite directions while tight supply demand forces have helped to support palladium. The most industrial orientated of the precious metals, palladium, has had the highest correlation to the S&P 5. Investors seeking improved diversification may find attractive alternatives in the precious metals without many of the nuances of other less easily storable commodities. The palladium / gold ratio has trended closely with the S&P 5 index 2,2 2, 1,8 1,6 China auto sales (passenger car, 12-month sum, rhs) Q1 1 Data % of Total Annual Supply 2 Source: ETF Securities, Bloobmerg, Monthly data from 1/2/25 thru 3/31/215. China precious metals imports. Analysis of the rolling 12-month sum 3-Months Change S&P 5 (lhs) 6-Months Change Palladium / gold ratio (rhs) 12-Months Change 2 15 5-24-Months Change.8.7.6.5 Gold ETF flows turn positive in Q1 While total known global gold ETF holdings declined 34% over the past two years, gold had positive ETF flows in Q1, increasing 1.4% for the first positive flow quarter since Q4 212. In contrast, silver ETF flows declined slightly in Q1 but have flat-lined the past two years dropping 1.9%. Platinum and palladium saw outflows in Q1 as holdings declining 2.5% and 5.9% respectively. The latest gold and silver ETF holdings were about 42% and 63% of total global annual supply, respectively. PGM ETF holdings weren t far behind with platinum at 4% and palladium at 33% of total global annual supply. Further illustrating this rapid migration of assets to physically backed precious metals ETFs; about 7% of above ground available silver supply is now held in ETF form compared to near zero in 25. Since the peak in 211, gold has trended in the opposite direction of the S&P 5 22 2 18 16 14 12 8 S&P 5 Spot Gold Source: ETF Securities, Bloomberg Weekly data from 1/2/28-3/31/215 6 28 29 2 211 212 213 214 215 $2,2 $2, $1,8 $1,6 $1,4 $1,2 $1, $8 $6 Summary Resilience facing uncertainty Despite strong headwinds of the rapidly increasing US dollar and looming Fed hikes, the PMs were resilient in Q1, declining less than the broad commodity market. - The PGMs declined on global economic concerns, but appear fundamentally undervalued as they remain in supply demand deficits while global auto sales are on track to continue to increase. - The best performer, silver, appeared to recover along with the spike in currency volatility and, by many measures, may be considered cheap. - Although the gold market has been all about Fed tightening fears recently, the Fed has little ammunition to pull the trigger on rate hikes. - Diversifier assets, like gold and the precious metals, appear poised to recover, notably if equity volatility normalizes and/or the Fed tightening consensus fades. 1,4 Source: ETF Securities, Bloomberg. Weekly data from 1/1/27 thru 3/27/215 1,2 212 213 214 215.4.3
Thousands of ounces Thousands of ounces Millions of ounces Millions of ounces 26 27 28 29 2 211 212 213 214 215 1998 2 22 24 26 28 2 212 214 Gold in US$ per ounce US yr Yield inverse in percent Ratio 5 Precious Metals Quarterly ETF Securities Analytics Gold and the yr appear to be in a similar pattern as 28/9 $2,3 $1,9 Gold spot 2-day MA (lhs) US yr Yield 2-day MA (inverse, rhs).5 1.5 The Gold / crude oil ratio recently reached multi highs Gold/Oil Ratio 3 25 $1,5 2.5 2 $1, 3.5 15 $7 Source: ETF Securities, Bloobmerg, Data from 1/2/26 thru 3/31/215. 4.5 $3 5.5 5 Souce: ETF Securities, Bloomberg. Data from 1/1/1998 thru 3/31/215 GLOBAL ETP HOLDINGS Gold Global ETP Holdings (million ounces) Daily Data, From 25 Apr 7 to 31 Mar 215 9 8 7 6 5 4 3 2 27 28 29 2 211 212 213 214 Source: ETF Securities, Bloomberg. Data from 4/25/27 to 3/31/215 Palladium Global ETP Holdings (' oz) Daily Data, From 25 Apr 7 to 31 Mar 215 3,5 3, 2,5 2, 1,5 1, 5 27 28 29 2 211 212 213 214 Source: ETF Securities, Bloomberg. Data from 4/25/27 to 3/31/215 Silver Global ETP Holdings (mn oz) Daily Data, From 25 Apr 7 to 31 Mar 215 7 6 5 4 3 2 27 28 29 2 211 212 213 214 Source: ETF Securities, Bloomberg. Data from 4/25/27 to 3/31/215 Platinum Global ETP Holdings (' oz) Daily Data, From 25 Apr 7 to 31 Mar 215 3,5 3, 2,5 2, 1,5 1, 5 27 28 29 2 211 212 213 Source: ETF Securities, Bloomberg. Data from 4/25/27 to 3/31/215
6 Precious Metals Quarterly ETF Securities PRICE MOMENTUM Gold Spot Prices and Moving Averages Daily Data, From Apr 1, 214 to Mar 31, 215 US$'s per ounce 1,4 1,35 1,3 1,25 1,2 Analytics Gold Spot (in US$/oz) Gold Spot (5 dma) Gold Spot (2 dma) Silver Spot Prices and Moving Averages Daily Data, From Apr 1, 214 to Mar 31, 215 US$'s per ounce 24 23 22 21 2 19 18 Silver Spot (in US$/oz) Silver Spot (5 dma) Silver Spot (2 dma) 1,15 1, Apr 14 Jun 14 Aug 14 Oct 14 Dec 14 Feb 15 Apr 15 Sources: ETF Securities, Bloomberg Platinum Spot Prices and Moving Averages Daily Data, From Apr 1, 214 to Mar 31, 215 1,6 17 16 15 Apr 14 Jun 14 Aug 14 Oct 14 Dec 14 Feb 15 Apr 15 Sources: ETF Securities, Bloomberg Palladium Spot Prices and Moving Averages Daily Data, From Apr 1, 214 to Mar 31, 215 95 1,5 9 US$'s per ounce 1,4 1,3 Platinum Spot (in US$/oz) 1,2 Platinum Spot (5 dma) Platinum Spot (2 dma) 1, Apr 14 Jun 14 Aug 14 Oct 14 Dec 14 Feb 15 Apr 15 Sources: ETF Securities, Bloomberg US$'s per ounce 85 8 75 Palladium Spot (in US$/oz) 7 Palladium Spot (5 dma) Palladium Spot (2 dma) 65 Apr 14 Jun 14 Aug 14 Oct 14 Dec 14 Feb 15 Apr 15 Sources: ETF Securities, Bloomberg FUTURES POSITIONING
Precious Metals Quarterly ETF Securities Important Risks Commodities generally are volatile and are not suitable for all investors. The statements and opinions expressed are those of the author and are as of the date of this report. All information is historical and not indicative of future results and subject to change. Reader should not assume that an investment in any securities and/or precious metals mentioned was or would be profitable in the future. This information is not a recommendation to buy or sell. Past performance does not guarantee future results. The ETFS Silver Trust, ETFS Gold Trust, ETFS Platinum Trust, ETFS Palladium Trust, ETFS Precious Metals Basket Trust, ETFS White Metals Basket Trust and ETFS Asian Gold Trust are not investment companies registered under the Investment Company Act of 194 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 investment objective of each Trust is for the shares to reflect the performance of the price of the precious metal(s) held by each Trust less the expenses of the Trust s operations. Fluctuations in the price could materially adversely affect an investment in the shares. Several factors may affect the price of precious metals, including: A change in economic conditions, such as a recession, can adversely affect the price of the precious metal held by the Trusts. 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; Investors' expectations with respect to the rate of inflation; Currency exchange rates; Interest rates; Investment and trading activities of hedge funds and commodity funds; and 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 Trusts or producing companies, it could cause a decline in world precious metal prices, adversely affecting the price of the shares. Also, should the speculative community take a negative view towards the precious metal held by the Trusts, it could cause a decline in prices, negatively impacting the price of the shares. There is a risk that part or all of the Trusts physical precious metal could be lost, damaged or stolen. Failure by the Custodian or Sub-Custodian to exercise due care in the safekeeping of the precious metal held by the Trusts could result in a loss to the Trusts. Commodities generally are volatile and are not suitable for all investors. Trusts focusing on a single commodity generally experience greater volatility. Please refer to the prospectus for complete information regarding all risks associated with the Trusts. Shares in the Trusts 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 Trusts). Only market makers or authorized participants may trade directly with the Trusts, typically in blocks of 5k to k shares. The S&P 5 Index is a capitalization-weighted index of 5 stocks selected by the Standard & Poor s Index Committee designed to represent the performance of the leading industries in the U.S. economy. The Bloomberg Commodity Index (BCOM) reflects commodity futures price movements. Fed Funds futures are cash settled to the simple average overnight Fed Funds Rate (the effective rate) for the delivery month. The overnight rate is calculated and reported by daily by the Federal Reserve Bank of NY. The Consumer Price Index (CPI) is a measure of prices paid by consumers for a market basked of consumer goods and services. The yearly (or monthly) growth rates represent the inflation rate. Quantitative easing (QE) is a relaxation of monetary policy achieved through the purchase of longer-dated securities by the central bank with the intent to change the quantity and mix of financial assets held by public investors. GDP (Gross Domestic Product) is the value of all final goods and services produced in the country. It is a broadcast measure of economic activity and the principal indicator of economic performance. An Exchange Traded Fund (ETF) is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. Standard deviation is a measure of the dispersion of a set of data from its mean.
8 Precious Metals Quarterly ETF Securities Important Risks This material must be accompanied or preceded by the prospectus. Carefully consider each Trust s investment objectives, risk factors, and fees and expenses before investing. Please click here to view the prospectus. ALPS Distributors, Inc. is separate and unaffiliated to all other entities mentioned herein. ALPS Distributors, Inc. is the marketing agent for ETFS Silver Trust, ETFS Gold Trust, ETFS Platinum Trust, ETFS Palladium Trust, ETFS Precious Metals Basket Trust, ETFS White Metals Basket Trust and ETFS Asian Gold Trust. For further discussion of the risks associated with an investment in the Trusts please read the prospectus. Mike McGlone is a registered representative of ALPS Distributors, Inc. ALPS Distributors, Inc. and ETF Securities are not affiliated entities. ETF 796 4/14/216 ETF Securities (US) LLC 48 Wall Street New York NY 5 United States t +1 844 ETFS BUY (844 383 7289) f +1 212 918 481 e infous@etfsecurities.com w etfsecurities.com