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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (49033)	4/3/2006 5:08:41 PM
From: aknahow	Respond to of 116555

While I have not done DD to confirm or refute your idea that the premium/discount accounts for more inflows outflows in other ETFs, intuitively I don't think so as it is much easier to buy the single unit (gold) to cover the short of ETF shares selling at a premium than a basket of securities but that can be done and perhaps it is easier than I think. At any rate, after three days of trading at a premium, which I believe adequate to provide a profitable short and coverage through delivery of physical, finally on the 4th day a delivery of physical gold was made. I expect that shares traded at a premium today also. Why did the prior 3 days of trading at a premium above ten b.P. not generate a physical delivery? I don't know! But, one of your post made me aware of the importance of intra day activity. Or perhaps it just was not possible to buy the physical gold at the time it was possible to short. Best to stick with, I don;t know. Today April 3 around 3 tons were added. I do expect that if the shares continue to trade at a premium more gold will be added. It is also possible that as the pog rises more b.p. will be necessary to cover the cost related to the purchase and delivery of gold. Don't know, about this either, just thinking about it.