abrdn Precious Metals Basket ETF Trust 10-K for FY2025
abrdn Precious Metals Basket ETF Trust (GLTR)
About this 10-K
abrdn Precious Metals Basket ETF Trust filed this 10-K on March 2, 2026, covering the fiscal year ended December 31, 2025 (FY2025).
Headline figures
Fiscal year ended December 31, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net income
- $1.07B
- up 526.2% from net income of $170.28M a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Transition Period from ___________________to___________________
Commission File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
| c/o abrdn ETFs Sponsor LLC |
|
| (Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated Filer | ☐ | |
| Non-Accelerated Filer | ☐ | Smaller Reporting Company | |
| Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared
or issued its audit report.
If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the
correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is
a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐
Yes ☒
Aggregate market value of the registrant’s
shares outstanding based upon the closing price of a share on June 30, 2025 as reported by the NYSE Arca, Inc. on that date: $
As of February 26, 2026, abrdn Precious Metals Basket ETF Trust had abrdn Physical Precious Metals Basket Shares ETF outstanding.
DOCUMENTS INCORPORATED BY
REFERENCE:
FORWARD LOOKING STATEMENTS
This Annual Report on Form 10-K contains various “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and within the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements usually include the words, “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “projects,” “understands” and other words suggesting uncertainty. We remind readers that forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future results, performance, levels of activity, or our achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Trust undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Additional significant uncertainties and other factors affecting forward-looking statements are presented in the Risk Factors section herein.
TABLE OF CONTENTS
PART I
Item 1. Business
The purpose of the abrdn Precious Metals Basket ETF Trust (the “Trust”) is to own, in an agreed proportion, gold, silver, platinum and palladium (collectively, “Bullion”) transferred to the Trust in exchange for shares issued by the Trust (“Shares”). Each Share represents a fractional undivided beneficial interest in and ownership of the Trust. The assets of the Trust consist solely of Bullion. The Trust was formed on October 18, 2010 when an initial deposit of Bullion was made in exchange for the issuance of two Baskets (at the time of the initial deposit, a “Basket” consisted of 50,000 Shares; effective June 18, 2024, the number of Shares comprising a Basket was reduced to 25,000 Shares).
The sponsor of the Trust is abrdn ETFs Sponsor LLC (the “Sponsor”). The trustee of the Trust is The Bank of New York Mellon (the “Trustee”) and the custodian is ICBC Standard Bank Plc (the “Custodian” or “ICBC”) (the “Custodian”).
The Trust’s Shares at redeemable value increased from $1,039,953,142 at December 31, 2024 to $2,577,422,977 at December 31, 2025, the Trust’s fiscal year end. Outstanding Shares in the Trust increased from 9,500,000 Shares at December 31, 2024 to 12,500,000 Shares at December 31, 2025.
The Trust is not managed like a corporation or an active investment vehicle. The Trust has no directors, officers or employees. It does not engage in any activities designed to obtain a profit from or to improve the losses caused by changes in the price of gold, silver, platinum and palladium. The Bullion held by the Trust will only be delivered to pay the remuneration due to the Sponsor (the “Sponsor’s Fee”), distributed to Authorized Participants (defined below) in connection with the redemption of Baskets or sold (1) on an as-needed basis to pay Trust expenses not assumed by the Sponsor, (2) in the event the Trust terminates and liquidates its assets, or (3) as otherwise required by law or regulation.
The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. The Trust does not and will not hold or trade in commodities futures contracts, “commodity interests” or any other instruments regulated by the Commodity Exchange Act (the “CEA”), as administered by the Commodity Futures Trading Commission (the “CFTC”) and the National Futures Association (“NFA”). The Trust is not a commodity pool for purposes of the CEA and the Shares are not “commodity interests,” and neither the Sponsor nor the Trustee is subject to regulation as a commodity pool operator or a commodity trading advisor in connection with the Shares. The Trust has no fixed termination date.
The Sponsor of the registrant maintains an Internet website at www.abrdn.com/us/etf through which the registrant’s annual reports on Form 10-K, quarterly reports on Form 10-Q, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, are made available free of charge as soon as reasonably practicable after they have been filed or furnished to the Securities and Exchange Commission (the “SEC”). The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically at www.sec.gov.
Trust Objective
The investment objective of the Trust is for the Shares to reflect the performance of the prices of physical gold, silver, platinum and palladium, in the proportions held by the Trust, less the Trust’s expenses. The Shares are intended to constitute a simple and cost-effective means of making an investment similar to a proportional investment in gold, silver, platinum and palladium. An investment in physical Bullion requires expensive and sometimes complicated arrangements in connection with the assay, transportation, warehousing and insurance of the metal. Although the Shares are not the exact equivalent of an investment in Bullion, they provide investors with an alternative that allows a level of participation in the gold, silver, platinum and palladium markets through the securities market.
The Shares are intended to provide institutional and retail investors with a simple and cost-efficient means, with minimal credit risk, of gaining investment benefits similar to those of holding physical Bullion. The Shares offer an investment that:
| ● | Easily Accessible and Relatively Cost Effective. Investors can access the gold, silver, platinum, and palladium markets through a traditional brokerage account. The Sponsor believes that investors will be able to more effectively implement strategic and tactical asset allocation strategies that use Bullion by using the Shares instead of using the traditional means of purchasing, trading and holding Bullion and for many investors, transaction costs related to the Shares will be lower than those associated with the purchase, storage and insurance of physical Bullion. |
2
| ● | Exchange Traded and Transparent. The Shares trade on the NYSE Arca, providing investors with an efficient means to implement various investment strategies. The Shares are eligible for margin accounts and are backed by the assets of the Trust and the Trust does not hold or employ any derivative securities. Furthermore, the value of the Trust’s holdings are reported on the Trust’s website daily. |
| ● | Minimal Credit Risk. The Shares represent an interest in physical bullion owned by the Trust (other than an amount held in unallocated form which is not sufficient to make up a whole bar or plate or ingot of which is held temporarily to effect a creation or redemption of Shares). Physical bullion of the Trust in the Custodian’s possession is not subject to borrowing arrangements with third parties. Other than the Bullion temporarily being held in an unallocated Bullion account with the Custodian, the physical bullion of the Trust is not subject to counterparty or credit risks. See “Risk Factors—Bullion held in the Trust’s unallocated Bullion account and any Authorized Participant’s unallocated Bullion account is not segregated from the Custodian’s assets...” This contrasts with most other financial products that gain exposure to bullion through the use of derivatives that are subject to counterparty and credit risks. |
Investing in the Shares does not insulate the investor from certain risks, including price volatility. See “Risk Factors.”
Overview of the Bullion Industry
This section provides a brief introduction to the Bullion industries by looking at some of the key participants, detailing the primary sources of demand and supply and, with respect to the gold and silver industries, outlining the role of the “official” sector (i.e., central banks) in the markets.
In this annual report, the term “ounces” refers to fine troy ounces (with respect to gold only) and troy ounces (with respect to silver, platinum and palladium).
The Gold Industry
Market Participants
The participants in the world gold market may be classified in the following sectors: the mining and producer sector, the banking sector, the official sector, the investment sector, and the manufacturing sector. A brief description of each follows.
Mining and Producer Sector
This group includes mining companies that specialize in gold and silver production, mining companies that produce gold as a by-product of other production (such as a copper or silver producer), scrap merchants and recyclers.
Banking Sector
Gold bullion banks provide a variety of services to the gold market and its participants, thereby facilitating interactions between other parties. Services provided by the gold bullion banking community include traditional banking products as well as mine financing, physical gold purchases and sales, hedging and risk management, inventory management for industrial users and consumers, and gold deposit and loan instruments.
The Official Sector
The official sector encompasses the activities of the various central banking operations of gold-holding countries. According to statistics provided by the World Gold Council, as of Q4 2025, central banks are estimated to hold approximately 36,492 tonnes (“tonne” refers to one metric tonne, which is equivalent to 1,000 kilograms or 32,151 troy ounces) of gold reserves.
The Investment Sector
This sector includes the investment and trading activities of both professional and private investors and speculators. These participants range from large hedge and mutual funds to day-traders on futures exchanges, and retail-level coin collectors.
The Manufacturing Sector
The fabrication and manufacturing sector represents all the commercial and industrial users of gold for whom gold is a daily part of their business. The jewelry industry is a large user of gold. Other industrial users of gold include the electronics and dental industries.
3
World Gold Supply and Demand 2015-2024 (in tonnes)
The following table sets forth a summary of the world gold supply and demand for the period from 2015 to 2024 and is based on information reported by the World Gold Council. Information for the calendar year ended 2025 is not available as of the date of this report.
| (tonnes) | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | ||||||||||||||||||||||||||||||
| Supply | ||||||||||||||||||||||||||||||||||||||||
| Mine production | 3,362 | 3,516 | 3,581 | 3,658 | 3,606 | 3,483 | 3,579 | 3,645 | 3,641 | 3,645 | ||||||||||||||||||||||||||||||
| Net producer hedging | 13 | 38 | (26 | ) | (12 | ) | 6 | (37 | ) | (5 | ) | (7 | ) | 69 | (54 | ) | ||||||||||||||||||||||||
| Recycled gold | 1,067 | 1,232 | 1,112 | 1,132 | 1,276 | 1,293 | 1,136 | 1,136 | 1,234 | 1,366 | ||||||||||||||||||||||||||||||
| Total supply | 4,442 | 4,786 | 4,667 | 4,778 | 4,888 | 4,739 | 4,710 | 4,775 | 4,944 | 4,957 | ||||||||||||||||||||||||||||||
| Demand | ||||||||||||||||||||||||||||||||||||||||
| Jewellery fabrication | 2,479 | 2,023 | 2,267 | 2,298 | 2,162 | 1,332 | 2,252 | 2,208 | 2,208 | 2,027 | ||||||||||||||||||||||||||||||
| Jewellery consumption | 2,459 | 2,108 | 2,250 | 2,263 | 2,142 | 1,405 | 2,177 | 2,095 | 2,109 | 1,888 | ||||||||||||||||||||||||||||||
| Jewellery inventory | 20 | (85 | ) | 17 | 34 | 20 | (73 | ) | 75 | 114 | 99 | 139 | ||||||||||||||||||||||||||||
| Technology | 338 | 329 | 339 | 342 | 333 | 309 | 337 | 315 | 305 | 326 | ||||||||||||||||||||||||||||||
| Electronics | 268 | 262 | 272 | 275 | 269 | 255 | 279 | 258 | 249 | 271 | ||||||||||||||||||||||||||||||
| Other Industrial | 51 | 50 | 51 | 52 | 50 | 42 | 47 | 47 | 47 | 47 | ||||||||||||||||||||||||||||||
| Dentistry | 19 | 18 | 16 | 15 | 14 | 12 | 11 | 10 | 9 | 9 | ||||||||||||||||||||||||||||||
| Investment | 964 | 1,622 | 1,322 | 1,167 | 1,282 | 1,805 | 1,007 | 1,125 | 951 | 1,181 | ||||||||||||||||||||||||||||||
| Total bar and coin | 1,087 | 1,079 | 1,051 | 1,097 | 878 | 913 | 1,196 | 1,235 | 1,195 | 1,187 | ||||||||||||||||||||||||||||||
| Bars | 787 | 803 | 787 | 782 | 590 | 553 | 826 | 814 | 787 | 863 | ||||||||||||||||||||||||||||||
| Official Coins | 224 | 208 | 188 | 242 | 221 | 290 | 284 | 321 | 293 | 199 | ||||||||||||||||||||||||||||||
| Medals/Imitation Coins | 76 | 68 | 76 | 73 | 67 | 70 | 86 | 100 | 115 | 126 | ||||||||||||||||||||||||||||||
| ETFs & similar products | (124 | ) | 543 | 271 | 70 | 404 | 893 | (189 | ) | (110 | ) | (244 | ) | (6 | ) | |||||||||||||||||||||||||
| Central banks & other inst. | 580 | 395 | 379 | 656 | 605 | 255 | 450 | 1,080 | 1,051 | 1,089 | ||||||||||||||||||||||||||||||
| Gold demand | 4,360 | 4,370 | 4,307 | 4,463 | 4,382 | 3,701 | 4,047 | 4,729 | 4,515 | 4,623 | ||||||||||||||||||||||||||||||
| OTC and other* | 82 | 416 | 360 | 316 | 506 | 1,038 | 663 | 46 | 429 | 334 | ||||||||||||||||||||||||||||||
| Total demand | 4,442 | 4,786 | 4,667 | 4,778 | 4,888 | 4,739 | 4,710 | 4,775 | 4,944 | 4,957 | ||||||||||||||||||||||||||||||
| LBMA Gold Price (US$/oz) | 1,160 | 1,251 | 1,257 | 1,268 | 1,393 | 1,770 | 1,799 | 1,800 | 1,941 | 2,386 | ||||||||||||||||||||||||||||||
Source: Metals Focus, Refinitiv GFMS, ICE Benchmark Administration, World Gold Council
| * | This number captures demand in the OTC market (for which data is not readily available), changes to inventories on commodity exchanges, any unobserved changes in fabrication inventories and any statistical residual. It is the difference between total supply and gold demand. |
The following are some of the main characteristics of the gold market illustrated by the table:
One factor which separates gold from other precious metals is that there are large above-ground stocks which can be quickly mobilized. As a result of gold’s liquidity, gold often acts more like a currency than a commodity.
Over the past ten years, (new) mine production of gold has experienced a modest rise of an average of 1.09% per annum. Of the three sources of supply, mine production accounts for 73.5% in 2024. Recycled gold volumes have ranged from 1,067 tonnes to 1,366 tonnes over the past 10 years.
On the demand side, jewelry is clearly the greatest source of demand, accounting for 43.8% of total demand in 2024. Industrial demand has fluctuated between 6.7% and 8.3% of total demand over the past 10 years. Exchange traded product inventory build was positive each year from 2016 to 2020, averaging 8% of total demand and peaking at 24.1% in 2020, but experienced net outflows on average of -3.1% from 2021 to 2024. Coin and bar demand fell to a 10-year low in 2019 but has since averaged 26.5% of total demand from 2020 to 2024. Demand from Central Banks and other institutions fluctuated between 8.8% and 14.7% from 2015 to 2019, before reaching a low of 6.9% in 2020. However, that figure has increased in each of the last three years, reaching a high of 23.6% in 2024.
Historical Chart of the Price of Gold
The price of gold is volatile and fluctuations are expected to have a direct impact on the value of the Shares. However, movements in the price of gold in the past are not a reliable indicator of future movements. Movements may be influenced by various factors, including announcements from central banks regarding a country’s reserve gold holdings, agreements among central banks, political uncertainties around the world, and economic concerns.
The following chart illustrates the movements in the price of an ounce of gold in U.S. Dollars from December 31, 2015 to December 31, 2025.
Source: Bloomberg, Aberdeen Chart data from 12/31/2015 to 12/31/2025. Spot Gold Price = GOLDLNPM Index.
The price of gold tends to rise during periods of low real interest rates and high monetary expansion, as they are often associated with currency debasement and systemic financial failures. The price of gold peaked at $1,943.20 per ounce in January 2021 as the uncertainties regarding the pandemic drove prices higher. 2021 proved to be a volatile year for gold as major market events and continued pandemic uncertainty, coupled with new variants, allowed gold to remain in the investment picture during the year. Additionally, the trends of 3 years of investor outflows in global ETFs and net negative investor sentiment in gold futures positioning reversed in 2016 and continued through 2020. Continued low real interest rates, tepid economic growth, and concerns regarding the recovery of the pandemic were key tailwinds for gold that sparked a return of investor interest. 2022 proved to be another volatile year for gold as the price climbed as high as $2,039.05 per ounce in the weeks following Russia’s invasion of Ukraine. Aggressive interest rate hikes by the U.S. Federal Reserve combined with a firming US Dollar led ETF holders to liquidate as the price of gold dropped as low as $1,628.75 per ounce on November 3, 2022. However, increased demand from central banks, along with the weakening of the U.S. Dollar, sparked a Q4 rally that saw the price of gold climb to $1,813.75 per ounce to close 2022.
4
Similarly in 2023, economic and geopolitical factors continued to drive volatility in the price of gold over the course of the year. While the central bank demand that sparked a fourth quarter rally remained strong throughout the year, a weaker US Dollar and a drop in US 10-Year Treasury Yields caused the price of gold to reach $1,932.45 per ounce on January 26, 2023. However, the disappointing Chinese economic recovery drove the price lower, before the U.S. banking crisis increased the likelihood of U.S. policy rate cuts and investors turned to gold in anticipation of lower interest rates. However, the subsequent interest rate hike by the U.S. Federal Reserve in May contributed to the price of gold falling further. During the third quarter the price of gold continued to fluctuate as a weaker dollar and central bank purchasing provided support before the U.S. Federal Reserve’s final interest rate hike of the year increased the probability of a policy rate mistake given mixed economic news leading the price to close as low as $1,870.50 per ounce on September 29, 2023. The spot price of gold continued to fall at the start of the fourth quarter before the U.S. Treasury shifted issuance to short duration bonds, lowering 10-year yields. While treasury market yields moved lower, removing the risk of excessive policy rate tightening, tensions in the Middle East increased with the attacks by Hamas on Israeli targets and civilians escalating the ongoing conflict between the two entities, driving the spot price higher. The spot price of gold gave back some of its gains over the first half of November before speculation of potential interest rate cuts in the U.S. and Chinese economic stimulus drove the spot price of gold to an all-time high of $2,078.40 per ounce on December 28, 2023.
In 2024, the spot price of gold was relatively flat to start the year as metals investors focused on hopes of economic stimulus out of China making a meaningful rise in demand in more cyclically exposed metals like copper and silver. This led to a continuation of the sharp reduction in gold owned by ETF investors into March, which moderated into June as it became clear the U.S Federal Reserve was going to need to cut interest rates in the Autumn. From July to October these investors added to positions helping support gold prices as central bank purchases continued albeit without the People’s Bank of China which halted purchases between June and October. The primary motivator for central bank purchases of gold are as a foreign exchange reserves diversifier away from U.S dollars and Treasuries at the margin. The Council on Foreign Relations notes a primary risk to emerging market economies comes from sanctions, tariffs and U.S. Dollar trading system bans on behest of western economies. We view the addition of gold to foreign reserves as the actions of a prudent investor diversifying risk, not as an indication of the imminent loss of global reserve currency status for the U.S. dollar. That said, results of the U.S. election raised the prospects of sanctions, and tariffs and thus the motivation of central banks to continue reserve diversification with gold purchases.
The threat of tariffs and sanctions were very much in focus at the start of 2025, with the market narrative that blanket U.S. tariffs could potentially cause a recession that would require aggressive interest rate cuts, driving interest in exchange-traded funds (ETFs), while the spot climbed to $3,115.1 per ounce to end the first quarter. Despite the increase in the spot price, the magnitude of U.S. tariffs at the start of April continued to support demand from central banks moving to diversify their foreign exchange reserves away from U.S. dollars and treasuries, which can become illiquid in the event of tariffs or sanctions. Further, Chinese insurance companies were given the option to own gold, and several joined the Shanghai Gold Exchange as members. Those holdings would be longer-term based and early signs indicated an uptick in gold demand from that sector, which provided an additional tailwind to the spot price. However, in May, progress on trade deal frameworks with a number of countries, as well as a Federal Reserve which seemed hesitant to cut rates, sent the spot price of gold into a tighter range of trading where it would remain until the end of August. Following U.S. employment numbers that were revised dramatically lower, it became clear the Federal Reserve would need to cut in September, driving investment demand for gold higher. The combination of investor demand and central bank demand created a powerful rally into the end of September. Following a 10% selloff in October, gold experienced a sustained rally into year-end that saw the spot price close out the year up 65% at $4,307.95 per ounce.
The Silver Industry
Market Participants
The participants in the world silver market may be classified in the following sectors: the mining and producer sector, the banking sector, the official sector, the investment sector, and the manufacturing sector. A brief description of each follows.
Mining and Producer Sector
This group includes mining companies that specialize in silver and silver production, mining companies that produce silver as a by-product of other production (such as a copper or gold producer), scrap merchants and recyclers. According to The Silver Institute’s World Silver Survey 2025, the top 20 producing countries are set forth in the table below. As the World Silver Survey 2025 was published in April 2025, information for 2025 is not available as of the date of this report.
| In million ounces | 2023 | 2024 | Y/Y | |||||||||
| Mexico | 181.9 | 185.7 | 2 | % | ||||||||
| China | 111.6 | 110.1 | -1 | % | ||||||||
| Peru | 108.9 | 108.0 | -1 | % | ||||||||
| Bolivia | 43.2 | 47.8 | 11 | % | ||||||||
| Chile | 52.0 | 43.2 | -17 | % | ||||||||
| Poland | 42.5 | 42.5 | 0 | % | ||||||||
| Russia | 38.3 | 41.0 | 7 | % | ||||||||
| Australia | 32.7 | 38.8 | 19 | % | ||||||||
| United States | 33.1 | 36.2 | 10 | % | ||||||||
| Argentina | 26.0 | 24.9 | -4 | % | ||||||||
| India | 23.8 | 22.5 | -5 | % | ||||||||
| Kazakhstan | 16.4 | 16.1 | -2 | % | ||||||||
| Sweden | 12.6 | 11.6 | -8 | % | ||||||||
| Indonesia | 10.9 | 11.5 | 5 | % | ||||||||
| Canada | 7.1 | 9.5 | 33 | % | ||||||||
| Morocco | 8.9 | 8.6 | -4 | % | ||||||||
| Uzbekistan | 7.1 | 7.8 | 9 | % | ||||||||
| Papua New Guinea | 4.3 | 4.2 | -3 | % | ||||||||
| Spain | 3.7 | 3.5 | -5 | % | ||||||||
| Portugal | 3.4 | 3.5 | 3 | % | ||||||||
| Others | 44.4 | 42.8 | -4 | % | ||||||||
| Total | 812.7 | 819.7 | 1 | % | ||||||||
Source: The Silver Institute - World Silver Survey 2025 (Metals Focus)
5
Banking Sector
Bullion banks provide a variety of services to the silver market and its participants, thereby facilitating interactions between other parties. Services provided by the bullion banking community include traditional banking products as well as mine financing, physical silver purchases and sales, hedging and risk management, inventory management for industrial users and consumers and silver leasing.
The Official Sector
There are no official statistics published by the International Monetary Fund, Bank for International Settlements, or national banks on silver holdings by national governments. The main reason for this is that silver is generally not recognized as a reserve asset.
Consequently, there are very limited silver stocks held by governments. According to The Silver Institute World Silver Survey 2025, the identifiable silver bullion inventories are as set forth in the table below. As the World Silver Survey 2025 was published in April 2025, information for 2025 is not available as of the date of this report.
Identifiable Silver Bullion Inventories*
| Million ounces | 2022 | 2023 | 2024 | Y/Y | ||||||||||||
| London Vaults | 840.9 | 856.2 | 827.5 | -3 | % | |||||||||||
| COMEX | 299.0 | 277.9 | 318.6 | 15 | % | |||||||||||
| Shanghai Futures Exchange (SHFE) | 69.2 | 38.2 | 43.9 | 15 | % | |||||||||||
| Shanghai Gold Exchange (SGE) | 69.0 | 46.5 | 40.5 | -13 | % | |||||||||||
| Other | 7.4 | 4.1 | 8.6 | 109 | % | |||||||||||
| Total | 1,285.5 | 1,229.9 | 1,239.2 | 1 | % | |||||||||||
*Year-end; Source: The Silver Institute - World Silver Survey 2025 (Metals Focus, LBMA, CME, SGE, SHFE, MCX & OSE)
The Investment Sector
This sector includes the investment and trading activities of both professional and private investors and speculators. These participants range from large hedge and mutual funds to day-traders on futures exchanges, and retail-level coin collectors.
The Manufacturing Sector
The fabrication and manufacturing sector represents all the commercial and industrial users of silver. Industrial applications comprise the largest use of silver. The jewelry and silverware sector is the second largest, followed by the photographic industry (although the latter has been declining over a number of years as a result of the spread of digital photography).
6
World Silver Supply and Demand 2016-2025
The following table sets forth a summary of the world silver supply and demand for the period from 2016 to 2025 and is based on information reported by the World Silver Survey 2025, published by The Silver Institute. As the World Silver Survey 2025 was published in April 2025, the table below includes forecasted information for 2025 as of the date of publication. As of the date of this report, final figures (i.e., non-forecasted) for 2025 are not yet available.
| Year on Year | |||||||||||||||||||||||||||||||||||||
| (in millions of ounces) | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025F* | 2024 | 2025F* | |||||||||||||||||||||||||
| Supply | |||||||||||||||||||||||||||||||||||||
| Mine Production | 900.1 | 863.9 | 850.8 | 837.4 | 783.8 | 830.8 | 839.4 | 812.7 | 819.7 | 835.0 | 1 | % | 2 | % | |||||||||||||||||||||||
| Recycling | 156.3 | 160.2 | 162.3 | 163.8 | 180.5 | 190.7 | 193.5 | 183.5 | 193.9 | 193.2 | 6 | % | -0.4 | % | |||||||||||||||||||||||
| Net Hedging Supply | — | — | — | 13.9 | 8.5 | — | — | — | — | 0.9 | na | na | |||||||||||||||||||||||||
| Net Official Sector Sales | 1.1 | 1.0 | 1.2 | 1.0 | 1.2 | 1.5 | 1.7 | 1.6 | 1.5 | 1.5 | -9 | % | 4 | % | |||||||||||||||||||||||
| Total Supply | 1,057.4 | 1,025.1 | 1,014.3 | 1,016.2 | 974.0 | 1,023.1 | 1,034.6 | 997.8 | 1,015.1 | 1,030.6 | 2 | % | 2 | % | |||||||||||||||||||||||
| Demand | |||||||||||||||||||||||||||||||||||||
| Industrial | 491.0 | 528.0 | 525.8 | 525.4 | 511.9 | 564.1 | 592.3 | 657.1 | 680.5 | 677.4 | 4 | % | -0.5 | % | |||||||||||||||||||||||
| Electrical & Electronics | 309.0 | 339.1 | 330.4 | 326.6 | 321.4 | 350.7 | 370.7 | 444.4 | 460.5 | 465.6 | 4 | % | 1 | % | |||||||||||||||||||||||
| …of which photovoltaics | 81.6 | 99.3 | 87.0 | 74.9 | 82.8 | 88.9 | 118.1 | 192.7 | 197.6 | 195.7 | 3 | % | -1 | % | |||||||||||||||||||||||
| Brazing Alloys & Solders | 49.1 | 50.9 | 52.0 | 52.4 | 47.5 | 50.5 | 49.2 | 50.2 | 51.6 | 52.9 | 3 | % | 3 | % | |||||||||||||||||||||||
| Other Industrials | 132.9 | 138.0 | 143.5 | 146.4 | 142.9 | 162.9 | 172.4 | 162.6 | 168.4 | 158.9 | 4 | % | -6 | % | |||||||||||||||||||||||
| Photography | 34.7 | 32.4 | 31.4 | 30.7 | 26.9 | 27.7 | 27.7 | 27.3 | 25.5 | 24.2 | -7 | % | -5 | % | |||||||||||||||||||||||
| Jewelry | 189.1 | 196.2 | 203.2 | 201.6 | 150.9 | 182.0 | 234.5 | 203.1 | 208.7 | 196.2 | 3 | % | -6 | % | |||||||||||||||||||||||
| Silverware | 53.5 | 59.4 | 67.1 | 61.3 | 31.2 | 40.7 | 73.5 | 55.1 | 54.2 | 46.0 | -2 | % | -15 | % | |||||||||||||||||||||||
| Net Physical Investment | 212.9 | 155.8 | 165.9 | 187.4 | 208.1 | 284.3 | 338.3 | 244.3 | 190.9 | 204.4 | -22 | % | 7 | % | |||||||||||||||||||||||
| Net Hedging Demand | 12.0 | 1.1 | 7.4 | — | — | 3.5 | 17.9 | 11.5 | 4.3 | — | -62 | % | na | ||||||||||||||||||||||||
| Total Demand | 993.3 | 972.9 | 1,008.8 | 1,006.4 | 929.0 | 1,102.4 | 1,284.2 | 1,198.5 | 1,164.1 | 1,148.3 | -3 | % | -1 | % | |||||||||||||||||||||||
| Market Balance | 64.1 | 52.2 | 13.5 | 9.8 | 45.1 | (79.3 | ) | (249.6 | ) | (200.6 | ) | (148.9 | ) | (117.6 | ) | -26 | % | -21 | % | ||||||||||||||||||
| Net Investment in ETPS | 53.9 | 7.2 | (21.4 | ) | 83.3 | 331.1 | 64.9 | (117.4 | ) | (37.6 | ) | 61.6 | 70.0 | na | 14 | % | |||||||||||||||||||||
| Market Balance less ETPS | 10.2 | 45.1 | 34.9 | (73.5 | ) | (286.1 | ) | (144.3 | ) | (132.2 | ) | (163.0 | ) | (210.5 | ) | (187.6 | ) | 29 | % | -11 | % | ||||||||||||||||
| Silver Price (US$/oz, London Price) | 17.1 | 17.1 | 15.7 | 16.2 | 20.6 | 25.1 | 21.7 | 23.4 | 28.3 | — | 21 | % | na | ||||||||||||||||||||||||
* Forecasted
Source: The Silver Institute - World Silver Survey 2025 (Metals Focus)
7
The following are some of the main characteristics of the silver market illustrated by the table.
The balance between silver supply and demand is a fundamental driver of its price. Silver has some of the same drivers of investment demand as gold, in that it can be used as a hedge against inflation or currency devaluation, or for portfolio diversification as an alternative currency. As such, silver investment demand may be influenced by interest rates. Silver, unlike gold, has a significant demand for industrial applications, such as electronics, solar panels, and medical equipment, due to its unique properties, such a high thermal and electrical conductivity.
New mine production accounts for approximately 82.3% of total silver supply. Recycled silver accounts for around 17.3% of total supply.
Industrial applications and jewelry demand accounted for over 58% of total demand in 2024. Photography has been taking a lower share of overall silver demand, falling from 3.5% in 2016 to 2.2% in 2024, while photovoltaic demand has risen in recent years accounting for 17% in 2024. Net physical investment (i.e. in coins and bars) fell for a second consecutive year, accounting for 16% of demand in 2024, down from a high of 26.3% in 2022.
Historical Chart Of The Price Of Silver
The price of silver is volatile and fluctuations are expected to have a direct impact on the value of the Shares. However, movements in the price of silver in the past are not a reliable indicator of future movements. Movements may be influenced by various factors, including announcements from central banks regarding a country’s reserve silver holdings, agreements among central banks, political uncertainties around the world, and economic concerns. The following chart illustrates the movements in the price of an ounce of silver in dollars from December 31, 2015 to December 31, 2025 and is based on information provided by Bloomberg:
Source: Bloomberg, Aberdeen Chart data from 12/31/2015 to 12/31/2025. Spot Silver Price = SLVRLND Index.
The rise in the value of the U.S. Dollar, sluggish industrial growth and a tame inflation environment (which led some investors to revise their expectations of the effects of monetary expansion) were some of the drivers behind the movement fall in silver prices from 2015 to 2019. Silver reversed course in 2020, after COVID stimulus measures were announced, helping prices rise 46.75%, closing the year at $26.49 per ounce. In 2021, silver took a slight step back after its performance in 2020, as it returned -13% for the year, as silver took a backseat to riskier asset classes.
2022 was a volatile year for silver as well as other metals in the wake of Russia’s invasion of Ukraine. The invasion caused sanctions and geopolitical unrest which weighed on the economic outlook and affected the interest rate outlook. Ultimately silver finished the year at $23.95 per ounce, with a yearly performance of +2.77%.
The strong demand and reduced supply trends that were prevalent towards the end of 2022 were expected to continue in 2023. However economic and geopolitical factors including a US banking crisis drove interest rate and industrial demand volatility for the year. The price of silver ultimately ended the year at $23.79 per ounce on December 29, 2023, down -0.65% for the year, as market participants were disappointed by the lack of economic stimulus in China.
In 2024, the spot price of silver began the year on a downward trend as the economic stimulus out of China at the end of 2023 disappointed investors and had little immediate effect on the economy. The potential for U.S. interest rate cuts inspired some increased attention by investors over the summer months. The U.S. Federal Reserve’s interest rate cut provided an additional tailwind that would send the price as high as $32.48 per ounce on September 26, 2024. Headwinds grew as the US election resulted in an increased potential of tariffs that are large enough to slow Chinese economic growth. Overall, the year was marked by alternating optimism and pessimism on China’s economic activity and levels of stimulus. Additional volatility came from a disappointing energy transition in the U.S. despite an outperforming energy transition in China where silver’s use in solar panel manufacturing is a key silver demand driver.
8
In 2025, as the threat of extreme tariffs and sanctions came into focus, the spot price of silver finally responded to the deficit that had existed over the prior six years. That market deficit has mostly been driven by industrial demand, however investor interest in Exchange-Traded Products (ETPs) also accounted for a sizable portion of this year’s rally. In April, the US administration added silver to the draft Section 232 notice, including it as a critical mineral and fueling speculation of US tariffs, which resulted in large volumes of silver being moved from London vaults to U.S. exchange vaults to avoid any potential tariffs, with the result of tightening silver availability in London, the highest volume market. The spot price rose to $54.10 per ounce on October 17, 2025. Following a 14% selloff in October, the spot price found ongoing support from industrial demand in India and China, as the jewelry/investing sector substituted silver purchases for gold, industrial demand increased, and the Indian government approved holding both gold and silver ETPs in local pension plans. While the decision to impose tariffs on critical minerals was ultimately delayed into 2026, market speculation and investor interest in ETPs more than doubled the market deficit with large purchases throughout the year. These factors combined to support a year-end rally that drove the spot price of silver to $71.99 per ounce on December 31, 2025, an increase of 149% from the prior year end.
Platinum Group Metals
Platinum and palladium are the two best known metals of the six platinum group metals (“PGMs”). Platinum and palladium have the greatest economic importance and are found in the largest quantities. The other four—iridium, rhodium, ruthenium and osmium—are produced only as co-products of platinum and palladium. PGMs are known for their purity, high melting points and unique catalytic properties. In addition to their oxidation and reduction properties, they are also extremely resistant to corrosion. PGMs are utilized in a number of industrial processes, technologies and commercial applications. Their unique chemical and physical properties make PGMs an excellent raw material, catalyst and ingredient for manufacturing processes. Consumer and industrial products made with platinum and other PGMs include flat panel monitors, glass fiber, medical tools, computer hard drives, nylon and razors, among others. PGMs play a critical role in autocatalysis and pollution control in the automotive sector.
PGM mining is heavily concentrated in southern Africa (South Africa and Zimbabwe), with smaller percentages coming from the United States, Russia and other locations. South Africa is the world’s leading platinum producer and one of the largest palladium producers. Russia is the second largest producer of platinum and palladium. All of South Africa’s production is sourced from the Bushveld Igneous Complex, which hosts the world’s largest resource of PGMs. Together, South Africa and Russia accounted for over 83% of platinum supply and 77% of palladium in 2024.
Platinum
World Platinum Supply and Demand 2015-2024
The following table sets forth a summary of the world platinum supply and demand over the last 10 years (from 2015 to 2024) and is based on information reported by Johnson Matthey, PGM Market Reports (2015 – 2025). Information for the year ended 2025 is not available as of the date of this report.
| (thousands of ounces) | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | ||||||||||||||||||||||||||||||
| Supply | ||||||||||||||||||||||||||||||||||||||||
| South Africa | 4,572 | 4,392 | 4,450 | 4,467 | 4,344 | 3,243 | 4,609 | 3,966 | 4,003 | 4,112 | ||||||||||||||||||||||||||||||
| Russia | 670 | 714 | 720 | 687 | 721 | 699 | 638 | 350 | 850 | 650 | ||||||||||||||||||||||||||||||
| North America | 339 | 370 | 368 | 370 | 367 | 334 | 279 | 280 | 288 | 267 | ||||||||||||||||||||||||||||||
| Zimbabwe | 400 | 489 | 466 | 474 | 451 | 482 | 465 | 488 | 515 | 507 | ||||||||||||||||||||||||||||||
| Others | 158 | 162 | 157 | 152 | 154 | 205 | 222 | 157 | 154 | 187 | ||||||||||||||||||||||||||||||
| Total primary supply | 6,139 | 6,127 | 6,161 | 6,150 | 6,037 | 4,963 | 6,213 | 5,241 | 5,810 | 5,723 | ||||||||||||||||||||||||||||||
| Recycling | ||||||||||||||||||||||||||||||||||||||||
| Autocatalyst | 1,136 | 1,132 | 1,249 | 1,332 | 1,389 | 1,154 | 1,230 | 1,201 | 1,074 | 1,084 | ||||||||||||||||||||||||||||||
| Electrical | 30 | 32 | 35 | 38 | 40 | 41 | 49 | 48 | 48 | 56 | ||||||||||||||||||||||||||||||
| Jewellery | 574 | 738 | 746 | 699 | 663 | 506 | 366 | 273 | 226 | 232 | ||||||||||||||||||||||||||||||
| Total secondary supply | 1,740 | 1,902 | 2,030 | 2,069 | 2,092 | 1,701 | 1,645 | 1,522 | 1,348 | 1,372 | ||||||||||||||||||||||||||||||
| Total combined supply | 7,879 | 8,029 | 8,191 | 8,219 | 8,129 | 6,664 | 7,858 | 6,763 | 7,158 | 7,095 | ||||||||||||||||||||||||||||||
| Demand by Application | ||||||||||||||||||||||||||||||||||||||||
| Auto | 3,273 | 3,339 | 3,061 | 2,815 | 2,589 | 2,024 | 2,410 | 2,743 | 3,353 | 3,410 | ||||||||||||||||||||||||||||||
| Chemical | 502 | 477 | 453 | 654 | 662 | 614 | 675 | 701 | 649 | 631 | ||||||||||||||||||||||||||||||
| Dental & Biomedical | 215 | 218 | 238 | 241 | 254 | 214 | 220 | 249 | 266 | 273 | ||||||||||||||||||||||||||||||
| Electrical & Electronics | 228 | 232 | 224 | 228 | 216 | 226 | 262 | 241 | 206 | 245 | ||||||||||||||||||||||||||||||
| Glass | 227 | 247 | 314 | 501 | 490 | 518 | 786 | 875 | 782 | 446 | ||||||||||||||||||||||||||||||
| Investment | 451 | 620 | 361 | 67 | 1,131 | 1,049 | (1 | ) | (475 | ) | 179 | 525 | ||||||||||||||||||||||||||||
| Jewellery | 2,746 | 2,413 | 2,385 | 2,258 | 2,073 | 1,657 | 1,468 | 1,401 | 1,372 | 1,375 | ||||||||||||||||||||||||||||||
| Petroleum | 140 | 186 | 228 | 380 | 262 | 286 | 222 | 241 | 160 | 144 | ||||||||||||||||||||||||||||||
| Pollution Control | — | — | 184 | 193 | 190 | 165 | 187 | 221 | 274 | 269 | ||||||||||||||||||||||||||||||
| Other | 494 | 535 | 530 | 531 | 542 | 417 | 444 | 483 | 550 | 551 | ||||||||||||||||||||||||||||||
| Total demand | 8,276 | 8,267 | 7,978 | 7,868 | 8,409 | 7,170 | 6,673 | 6,680 | 7,791 | 7,869 | ||||||||||||||||||||||||||||||
| Movements in Stocks | (397 | ) | (238 | ) | 213 | 351 | (280 | ) | (506 | ) | 1,185 | 83 | (633 | ) | (774 | ) | ||||||||||||||||||||||||
Source: Johnson Matthey PGM Market Reports (2015 – 2025)
| 1 | Primary supply: Supply figures represent sales of primary PGM by producers and are allocated to the region where mining took place, rather than the region of subsequent processing. |
| 2 | Secondary supply: Secondary supply is the quantity of metal recovered from open-loop recycling (i.e. where the original purchaser does not retain ownership of the PGM). Outside the automotive, jewelry and electronics markets, open-loop recycling is negligible. |
| 3 | Automotive recycling represents the weight of metal recovered from end-of-life vehicles and aftermarket scrap. It does not include warranty or production scrap. |
| 4 | Demand: Demand figures for any given application represent the sum of industry demand for new metal in that application, net of any closed-loop recycling (i.e. where industry participants retain ownership of the metal: an example would be recycling of spent chemical catalysts where the metal is retained to be used on fresh catalyst that replaces the spent charge). |
| 5 | Automotive demand is allocated to the region where the vehicle is manufactured and is accounted for at the time of vehicle production. It includes emissions catalysts on vehicles, motorcycles and three-wheelers, as well as fuel cell vehicles. Non-road mobile machinery is counted as industrial demand, in the pollution control category. |
| 6 | Jewelry demand is allocated to the region where the finished jewelry is manufactured, not sold. |
| 7 | Movements in stocks: This figure gives the overall market balance in any one year and reflects the extent of stocks that must be mobilized to balance the market in that year. It is thus a proxy for changes in stocks held by fabricators, dealers, banks and depositories, but excludes stocks held by primary and secondary refiners and final consumers. A positive figure (market surplus) thus reflects an increase in global market stocks. A negative value (market deficit) indicates a decrease in global market stocks. |
The following are some of the main characteristics of the platinum market illustrated by the table:
The main supplier of platinum is South Africa, providing approximately 72% of total mine supply over the past 10 years (2015-2024). Russia is the second largest supplier of platinum. Its share of world mine production has averaged around 11.4% of total mine supply over the past ten years ended 2024. Scrap supply from recycling of autocatalyst and other sources have accounted for about 22.9% of total supply over the last 10 years.
Over the ten years ended December 2024, jewelry demand for platinum peaked at approximately 33% of total demand in 2015. Jewelry demand has since declined to 17% of total demand in 2024, following a consistent downward trend. Automotive demand for platinum, which accounted for around 40% of total demand at the end of 2015, has increased to roughly 43% of total demand as of the end of 2024. Following two consecutive years of growth, investment demand fell from a high of 15% in 2020 into negative territory in 2022 at (7%) but improved to 7% in 2024. Pollution control demand, which captures the production demand of non-road vehicles such as agricultural equipment and industrial machinery as well as small engines and stationary source emissions controls in factories that use technology that is similar to autocatalysts, decreased to 3% in 2024 after increasing to 4% of total demand in 2023.
9
Historical Chart of the Price of Platinum
The price of platinum is volatile and fluctuations are expected to have a direct impact on the value of the Shares. However, movements in the price of platinum in the past are not a reliable indicator of future movements. The following chart illustrates the movements in the price of an ounce of platinum in U.S. Dollars from December 31, 2015 to December 31, 2025 and is based on information provided by Bloomberg:
Source: Bloomberg, Aberdeen Chart data from 12/31/2015 to 12/31/2025. Spot Platinum Price = PLTMLNPM Index.
Despite autocatalyst demand for platinum increasing in 2015, tightening nitrogen oxide emission standards led to pessimism about the future demand for platinum-heavy diesel autocatalysts relative to palladium-heavy gasoline autocatalysts. Further pessimistic outlook for South Africa’s economy and its currency, the South African Rand, weighed on platinum prices throughout 2017, and platinum continued to fall in 2018 driven by lackluster investor sentiment, a stronger US dollar, weaker diesel demand and rising mine supply. Platinum prices bounced back, rising 19.9% to $952 per ounce at the end of 2019. After seeing the price fall as low as $593 per ounce on March 19, 2020, platinum rebounded from pandemic lows and finished the year at $1,068 per ounce. The steep climb in palladium price led some investors to conclude that platinum appeared under-valued, in view of its potential to substitute for palladium in automotive applications in the future. Additionally, the outlook for mining in South Africa was increasingly uncertain, with producers facing steep increases in electricity prices, periodic disruption to power supplies and a risk of industrial action during anticipated wage negotiations. In 2021, platinum took a back seat to risky assets, similarly to other precious metals, as it returned -10% (as of December 31, 2021). Follow through from auto production disruptions during the pandemic were a major contributor to the price performance in 2021. The price of platinum reached as high as $1,151 per ounce on March 8, 2022, as Russia’s invasion of Ukraine and the threat of sanctions on Russian exports, including platinum, pushed prices higher. However, while other precious metals (gold, silver, palladium) saw prices fluctuate throughout the year, platinum’s volatility was much more pronounced within the first quarter of 2022, as the price fell roughly 15% by March 31, 2022, to close the first quarter at $983 per ounce. Aggressive interest rate hikes by the U.S. Federal Reserve, a strong U.S. Dollar and risks of diminishing global economic growth exerted additional pressure on prices, as the price of platinum fell as low as $831 per ounce on July 14, 2022. Through the end of 2022, increasing autocatalyst demand and a growing substitution of platinum for palladium contributed to ongoing physical market tightness, despite a global surplus, which saw the price of platinum increase roughly 24% from July 14, 2022 through December 31, 2022 to $1,031 per ounce.
In 2023, a decrease in platinum production in South Africa, the world’s leading producer, continued to impact global supply (see “World Platinum Supply and Demand in 2023” above for additional discussion). While industry analysis groups saw potential for a nearly 1-million-ounce deficit in platinum in 2023, the price performance did not reflect this sentiment over the course of the year as the market remained well supplied, pulling from existing above ground stockpiles. Despite a positive outlook at the beginning of the year, fueled by China’s loosening of Covid-related restrictions, that drove the price as high as $1,128 per ounce on April 21, 2023, the Chinese economic rebound disappointed investors and led the price of platinum to fall as low as $850 per ounce on November 13, 2023. While an end-of-year rally saw the price of platinum increase roughly 18% off the yearly low to $1,000 per ounce, platinum ended the year approximately 3% below its 2022 closing price.
In 2024, mining production in South Africa continued to impact global supply, as the country experienced some remaining power supply disruptions, although at a far lower pace than in 2023. Coupled with political instability, inflation and volatile market prices, which compressed profit margins and subsequently led to a decrease in expected supply from the world’s leading producer. As a result, platinum markets remained volatile throughout the year while prices did not respond to the existing supply side deficit as above ground stocks were being worked through. An increase in expected automotive demand provided some tailwinds during the first half of the year that sent the spot price of platinum as high as $1,065 per ounce on May 17, 2024. However, the lackluster Chinese economic rebound and disappointing level of stimulus turned to headwinds as the price retreated to $910 per ounce. The risk of additional sanctions on Russian metal exports in October provided some temporary price support, however market fears over supply restrictions quickly dissipated, and prices retreated once more. Headwinds grew as the US election resulted in an increased potential of tariffs that are large enough to slow global economic growth and the spot price of platinum ended the year down -8.6%, at $914 per ounce.
In 2025, platinum experienced its strongest rally in years as persistent supply deficits, elevated trading activity and geopolitical tensions drove prices sharply higher. While tightening emission standards in China and India supported Industrial Demand from the automotive industry, the larger trend this year has been from Chinese jewelry demand. The Chinese and Indian public are significant gold buyers; however, they are price sensitive and given capital restrictions, jewelry in China is also an investment - and not just jewelry. During London Platinum Week, in mid-May, compelling evidence emerged that the Chinese consumer had begun to revert to platinum jewelry from gold and the spot price of Platinum subsequently rallied from $986 per ounce on May 16, 2025, to $1474 per ounce on July 18, 2025. Platinum traded in a tighter range between July and mid-September, before U.S. tariff uncertainty and heavy buying from China and the U.S. amplified market tightness, driving the price into a range of $1,500 - $1,600 per ounce, where it would remain towards the end of November. However, on November 27th, 2025, the Guangzhou Futures Exchange launched a new futures contract on Platinum, further boosting optimism about Chinese demand. Speculative positioning intensified through the end of the year, sending prices to a 17 year high and lifting platinum to $2,226 per ounce before ending the year at $2,027 on December 31, 2025 (+121.8%).
10
Palladium
World Palladium Supply and Demand 2015-2024
The following table sets forth a summary of the world palladium supply and demand for the period from 2015 to 2024 and is based on information reported by Johnson Matthey, PGM Market Report. Information for the year ended 2025 is not available as of the date of this report.
| (thousands of ounces) | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | ||||||||||||||||||||||||||||||
| Supply | ||||||||||||||||||||||||||||||||||||||||
| South Africa | 2,683 | 2,570 | 2,547 | 2,543 | 2,571 | 1,975 | 2,645 | 2,288 | 2,360 | 2,420 | ||||||||||||||||||||||||||||||
| Russia | 2,434 | 2,781 | 2,452 | 2,976 | 2,987 | 2,636 | 2,689 | 2,200 | 2,700 | 2,750 | ||||||||||||||||||||||||||||||
| North America | 874 | 917 | 956 | 1,035 | 1,042 | 990 | 908 | 832 | 863 | 814 | ||||||||||||||||||||||||||||||
| Zimbabwe | 320 | 396 | 386 | 393 | 379 | 410 | 392 | 409 | 427 | 419 | ||||||||||||||||||||||||||||||
| Others | 144 | 129 | 131 | 135 | 140 | 185 | 212 | 235 | 247 | 251 | ||||||||||||||||||||||||||||||
| Total Supply | 6,455 | 6,793 | 6,472 | 7,082 | 7,119 | 6,196 | 6,846 | 5,964 | 6,597 | 6,654 | ||||||||||||||||||||||||||||||
| Secondary supply | ||||||||||||||||||||||||||||||||||||||||
| Automotive | 1,952 | 1,986 | 2,357 | 2,624 | 2,916 | 2,689 | 2,886 | 2,790 | 2,389 | 2,449 | ||||||||||||||||||||||||||||||
| Electronics/other | 475 | 481 | 479 | 475 | 477 | 430 | 444 | 457 | 466 | 481 | ||||||||||||||||||||||||||||||
| Jewellery | 46 | 21 | 21 | 12 | 12 | 9 | 9 | 10 | 10 | 10 | ||||||||||||||||||||||||||||||
| Total secondary supply | 2,473 | 2,488 | 2,857 | 3,111 | 3,405 | 3,128 | 3,339 | 3,257 | 2,865 | 2,940 | ||||||||||||||||||||||||||||||
| Total combined supply | 8,928 | 9,281 | 9,329 | 10,193 | 10,524 | 9,324 | 10,185 | 9,221 | 9,462 | 9,594 | ||||||||||||||||||||||||||||||
| Demand by Application | ||||||||||||||||||||||||||||||||||||||||
| Auto | 7,657 | 8,019 | 8,423 | 8,837 | 9,675 | 8,534 | 8,452 | 8,413 | 8,767 | 8,313 | ||||||||||||||||||||||||||||||
| Chemical | 449 | 419 | 435 | 605 | 530 | 498 | 593 | 602 | 539 | 546 | ||||||||||||||||||||||||||||||
| Dental & Biomedical | 474 | 435 | 398 | 364 | 320 | 228 | 208 | 189 | 192 | 177 | ||||||||||||||||||||||||||||||
| Electrical & Electronics | 903 | 872 | 844 | 768 | 711 | 636 | 649 | 547 | 516 | 535 | ||||||||||||||||||||||||||||||
| Investment | (659 | ) | (646 | ) | (386 | ) | (574 | ) | (87 | ) | (190 | ) | 17 | (109 | ) | 61 | 229 | |||||||||||||||||||||||
| Jewellery | 220 | 189 | 167 | 148 | 128 | 85 | 88 | 87 | 87 | 85 | ||||||||||||||||||||||||||||||
| Pollution Control | 56 | 71 | 78 | 86 | 88 | 75 | 92 | 102 | 123 | 124 | ||||||||||||||||||||||||||||||
| Other | 104 | 114 | 91 | 117 | 120 | 93 | 96 | 82 | 85 | 86 | ||||||||||||||||||||||||||||||
| Total Demand | 9,204 | 9,473 | 10,050 | 10,351 | 11,485 | 9,959 | 10,195 | 9,913 | 10,370 | 10,095 | ||||||||||||||||||||||||||||||
| Movements in stocks | (276 | ) | (192 | ) | (721 | ) | (158 | ) | (961 | ) | (635 | ) | (10 | ) | (692 | ) | (908 | ) | (501 | ) | ||||||||||||||||||||
Source: Johnson Matthey PGM Market Reports (2015 – 2025).
The following are some of the main characteristics of the palladium market illustrated by the table:
Russia has traditionally been the largest producer of palladium, providing on average 40% of supply over the past 10 years. South Africa has, on average, supplied approximately 37% of production over the past 10 years. In 2024, Russia provided 41.3% of mine supplies, while South Africa produced 36.4%. North America contributed approximately 13.9% of mine supply in 2024. Scrap supply, from recycling of autocatalyst and other sources, accounted for roughly 30.6% of total supply in 2024 in line with the value from 2023.
Autocatalysts continue to be the largest component of palladium demand, averaging 84.2% of total demand from 2015 to 2024, compared to 83.2% in 2015. Jewelry demand for palladium has tapered off considerably over the last 10 years, contributing only 0.8% of total demand in 2024, down from a high of 2.4% in 2015. Other industrial demand (chemical, dental and electrical) has fallen from 19.8% of total demand in 2015 to 12.5% of total demand in 2024. Since 2015, pollution control demand has increased from 0.6% to 1.2% of total demand. Pollution control demand captures the production demand for emissions control in non-automotive applications.
Historical Chart of the Price of Palladium
The price of palladium is volatile and fluctuations are expected to have a direct impact on the value of the Shares. However, movements in the price of palladium in the past are not a reliable indicator of future movements. The following chart illustrates the movements in the price of an ounce of palladium in U.S. Dollars from December 31, 2015 to December 31, 2025 and is based on information provided by Bloomberg:
Source: Bloomberg, Aberdeen Chart data from 12/31/2015 to 12/31/2025. Spot Palladium Price = PLDMLNPM Index.
The strong rally in 2014 palladium prices was completely unwound in 2015, when South African mine supply resumed back to pre-strike levels and pessimism about industrial demand in China overwhelmed the true tightness in the market. Palladium was then the top performer of the precious metals complex for 3 consecutive years from 2017 to 2019, where it rose nearly 182% from $676 per troy ounce on December 31, 2016 to $1,905 per troy ounce on December 31, 2019. The price of palladium reached an all-time high of $2,781/oz on February 19, 2020, before closing out the year at a price of $2,342/oz on December 31, 2020. Similar to other precious metals, palladium took a step back in 2021 as it returned -16% (as of December 31, 2021). A decline in autocatalyst demand due to the pandemic was a big reason for the negative performance seen during the year.
11
The price of palladium reached a record high of $3,015 per ounce on March 7, 2022, as Russian’s invasion of Ukraine infused uncertainty into global markets and created additional price pressure that pushed the price of palladium nearly 53% above its 2021 close. While each of the precious metals (gold, silver, platinum) saw prices fluctuate throughout the year, the price of palladium showed greater correlation with the price of Platinum during the first quarter. The price of palladium fell by roughly 25% between March 8th and March 31st, ending the first quarter at a price of $2,259 per ounce. On June 14th, 2022, the price of palladium fell as low as $1,810 per ounce, as aggressive interest rate policies from the U.S. Federal Reserve drove the U.S. Dollar higher. Contrary to the other three precious metals, the price of palladium increased as high as $2,315 per ounce on October 4th, 2022, as supplies were further constrained by operational challenges in South African and North American mines, as well as a weaker automotive recycling market. Throughout the year, tailwinds from supply disruptions were countered by weaker automotive and investment demand, higher interest rates and the risk of a potential recession. As a result, while the other three precious metals rallied to end the year, the price of palladium reversed course during the fourth quarter to end the year at $1,775 per ounce, down 10% from the end of 2021.
In 2023, palladium production in Russia and South Africa continued to impact global supply. Russian production was relatively flat compared to 2020 and 2021, however sanctions imposed in 2022 constrained the production capacity of Russian metals producer Nornickel, the world’s largest palladium producer. In contrast, South Africa continued to experience power supply disruptions along with rising electricity prices. Coupled with labor strikes, political instability, inflation and volatile prices, which compressed profit margins and subsequently led to a decrease in expected supply from the world’s second leading producer. However, despite the supply deficit, investors sold short a large amount of palladium that year, in hopes that electric vehicles would curtail the demand for palladium in gasoline-powered automobiles. Additionally, while a positive outlook at the beginning of the year, fueled by China’s loosening of COVID-19 related restrictions, drove the price as high as $1,628 per ounce on April 21, 2023, the Chinese economic rebound disappointed investors. As a result of these two factors, the price of palladium continued on a downward trend throughout most of the year before reaching a low of $957 per ounce on December 6, 2023. Fears of additional Russian sanctions sparked a year-end rally that saw the price climb as high as $1,221 per ounce on December 20, 2023, but the precious metal ultimately ended the year at $1,136 per ounce, 36% below its 2022 closing price.
In 2024, palladium markets continued to be volatile as the market remained net short and prices did not respond to the existing supply side deficit as the market worked through above ground stockpiles. While autocatalyst demand continued to be the largest component of palladium demand, it has not yet returned to pre-pandemic levels, and the price remained between $850 and $1,050 per ounce for much of the year. In October, the threat of potential new sanctions on Russian exports, which accounts for roughly 40% of new mined supply, sent the price as high as $1,222 per ounce on October 29, 2024, as short sellers bought long contracts to reduce their positions. However, once market fears about disruptions in supply dissipated the spot price retreated and ultimately ended the year at $909 per ounce on December 31, 2024 (-19.98%).
In 2025, palladium markets remained volatile, but benefited from a deficit-driven, supply-constrained environment that saw prices rebound off 2024 lows. While the palladium market has been in deficit of various magnitudes since 2012, this year saw a turn in the overwhelming narrative driving weak prices. Several mining companies reduced mining operations into the prior year end and U.S. government support for EV subsidies waned. Nearly 80% of palladium demand comes from the automotive sector for pollution control of internal combustion engine vehicles and hybrids. The cessation of the $7.500 EV tax credit in September accelerated automakers’ decisions to offer more fossil fuel and hybrid vehicles which use palladium for pollution control. Further, weaker than anticipated South African supply and recycling, along with revised market forecasts for 2025 and 2026, contributed to a sharp increase in the spot price of palladium that reached $1,297 per ounce on July 18, 2025, an increase of 42.7% from the end of 2024. The spot price of Palladium pulled back into a tighter range between July and the end of September before pricing became increasingly sensitive to financial flows, with futures positioning amplifying the movement in spot price driven by U.S. tariff uncertainty, South African disruptions, tighter leasing markets and strong Chinese imports. The spot price would reach as high as $1,837 per ounce, before ending the year at $1,567 per ounce on December 31, 2025 (+72.4%).
Operation of the Bullion Markets
The global trade in Bullion consists of Over-the-Counter (“OTC”) transactions in spot, forwards, and options and other derivatives, together with exchange-traded futures and options.
Global Over-The-Counter Market
The OTC market trades on a 24-hour per day continuous basis and accounts for most global Bullion trading.
Market makers, as well as others in the OTC market, trade with each other and with their clients on a principal-to-principal basis. All risks and issues of credit are between the parties directly involved in the transaction.
For gold and silver, market makers include the market-making members of the London Bullion Market Association (“LBMA”), the trade association that acts as the coordinator for activities conducted on behalf of its members and other participants in the London bullion market. As of the date of this report, the eleven market-making members of the LBMA are: BNP Paribas SA, Citibank N.A., HSBC Bank PLC, Goldman Sachs International, ICBC Standard Bank, JPMorgan Chase Bank, Merrill Lynch International, Morgan Stanley & Co. International Plc, Standard Chartered Bank, Toronto-Dominion Bank and UBS AG.
For platinum and palladium, five member participants of the London Platinum and Palladium Market (“LPPM”), the trade association that acts as the coordinator for activities conducted on behalf of its members and other participants in the LPPM, are currently participating in the London Metal Exchange’s (“LME”) administration of the LBMA Platinum and Palladium prices. In January 2026, the LBMA announced that it intends to appoint ICE Benchmark Administration (“IBA”) to replace the LME as the third-party administrator of the LBMA Platinum and Palladium prices in mid-2026. The OTC market provides a relatively flexible market in terms of quotes, price, size, destinations for delivery and other factors. Bullion dealers customize transactions to meet clients’ requirements. The OTC market has no formal structure and no open-outcry meeting place.
12
The main centers of the OTC market are London, Zurich and New York for gold and silver and London, New York, Hong Kong and Zurich for platinum and palladium. Mining companies, central banks, manufacturers of jewelry and industrial products, together with investors and speculators, tend to transact their business through one of these market centers. Centers such as Dubai and several cities in the Far East also transact substantial OTC market business, typically involving jewelry and small bars of gold or silver and small plates or ingots of platinum or palladium (1 kilogram or less) and will hedge their exposure by selling into one of these main OTC centers. Precious metals dealers have offices around the world and most of the world’s major bullion dealers are either members or associate members of the LBMA and/or the LPPM.
In the OTC market for gold, the standard size of trades between market makers ranges between 5,000 and 10,000 ounces. Bid-offer spreads are typically 50 US cents per ounce. Certain dealers are willing to offer clients competitive prices for much larger volumes, including trades over 100,000 ounces, although this will vary according to the dealer, the client and market conditions, as transaction costs in the OTC market are negotiable between the parties and therefore vary widely. Cost indicators can be obtained from various information service providers as well as dealers.
In the OTC market for silver, the standard size of trades between market makers is 100,000 ounces.
In the OTC market for platinum and palladium, the standard size of trades between market makers is 1,000 ounces.
Liquidity in the OTC market can vary from time to time during the course of the 24-hour trading day. Fluctuations in liquidity are reflected in adjustments to dealing spreads—the differential between a dealer’s “buy” and “sell” prices. The period of greatest liquidity in the Bullion markets generally occurs at the time of day when trading in the European time zones overlaps with trading in the United States, which is when OTC market trading in London, New York, Zurich and other centers coincides with futures and options trading on the Commodity Exchange, Inc. (“COMEX”), a designated contract market within the CME Group. This period lasts for approximately four hours each New York business day morning.
The Gold Bullion Market
The London Gold Bullion Market
Although the market for physical gold is distributed globally, most OTC market trades are cleared through London. In addition to coordinating market activities, the LBMA acts as the principal point of contact between the market and its regulators. A primary function of the LBMA is its involvement in the promotion of refining standards by maintenance of the “Good Delivery List,” which is a list of LBMA accredited refiners of gold. The LBMA also coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation.
The terms “loco London” gold and “loco Zurich” gold refer to gold physically held in London and Zurich, respectively, that meets the specifications for weight, dimensions, fineness (or purity), identifying marks (including the assay stamp of a LBMA acceptable refiner) and appearance set forth in “The Good Delivery Rules for Gold and Silver Bars” published by the LBMA. Gold bars meeting these requirements are described in this annual report from time to time as “London Good Delivery Bars.” The unit of trade in London is the troy ounce, whose gram conversion is: 1,000 grams equals 32.1507465 troy ounces and 1 troy ounce equals 31.1034768 grams. A London Good Delivery Bar is acceptable for delivery in settlement of a transaction on the OTC market. Typically referred to as 400-ounce bars, a London Good Delivery Bar must contain between 350 and 430 fine troy ounces of gold, with a minimum fineness (or purity) of 995 parts per 1,000 (99.5%), be of good appearance and be easy to handle and stack. The fine gold content of a gold bar is calculated by multiplying the gross weight of the bar (expressed in units of 0.025 troy ounces) by the fineness of the bar. A London Good Delivery Bar must also bear the stamp of one of the refiners who are on the LBMA approved list. Unless otherwise specified, the gold spot price always refers to that of a London Good Delivery Bar. Business is generally conducted over the phone and through electronic dealing systems.
On March 20, 2015, ICE Benchmark Administration (“IBA”) began administering the operation of an “equilibrium auction,” which is an electronic, tradable and auditable, over-the-counter auction market with the ability to settle trades in US Dollars (“USD”), Euros or British Pounds for LBMA-authorized participating gold bullion banks or market makers (“gold participants”) that establishes a reference gold price for that day’s trading. IBA’s equilibrium auction is the gold valuation replacement selected by the LBMA for the London gold fix previously determined by the London Gold Market Fixing Ltd. that was discontinued on March 19, 2015. IBA’s equilibrium auction, like the previous gold fixing process, establishes and publishes fixed prices for troy ounces of gold twice each London trading day during fixing sessions beginning at 10:30 a.m. London time (the “LBMA AM Gold Price”) and 3:00 p.m. London time (the “LBMA PM Gold Price”).
13
Daily during London trading hours the LBMA AM Gold Price and the LBMA PM Gold Price each provide reference gold prices for that day’s trading. Many long-term contracts will be priced on either the basis of the LBMA AM Gold Price or the LBMA PM Gold Price, and market participants will usually refer to one or the other of these prices when looking for a basis for valuations. The LBMA AM Gold Price and the LBMA PM Gold Price, determined according to the methodologies of IBA and disseminated electronically by IBA to selected major market data vendors, such as Refinitiv and Bloomberg, are widely used benchmarks for daily gold prices and are quoted by various financial information sources as the London gold fix was previously. The Trust values its gold on the basis of LBMA Gold Price PM. If there is no LBMA PM Gold Price on any day, the Trust will value its gold on the basis of LBMA AM Gold Price announced on that day. If neither price is available for that day, the Trust will value its gold based on the most recently announced LBMA PM Gold Price or LBMA AM Gold Price.
The LBMA PM Gold Price is the result of an “equilibrium auction” because it establishes a price for a troy ounce of gold that clears the maximum amount of bids and offers for gold entered by order-submitting gold participants each day. The opening bid and subsequent bid prices are generated by an algorithm based method, and each auction is actively supervised by IBA staff. There are currently 15 direct gold participants (Bank of China Limited, London Branch, Citibank N.A. London Branch, Coins ‘N Things, Inc., DRW Investments, LLC, Goldman Sachs, HSBC Bank USA NA, StoneX Financial Ltd., Jane Street Global Trading, LLC, JPMorgan Chase Bank, N.A. London Branch, Koch Supply and Trading LP, Marex, Morgan Stanley, Standard Chartered Bank, Toronto Dominion Bank, and Virtu Financial Global Markets, LLC), and IBA uses ICE’s front-end system, WebICE, as the technology platform that allows direct participants as well as sponsored clients to manage their orders in the auction in real time via their own screens.
The IBA auction process begins with a notice of an auction round issued to gold participants before the commencement of the auction round stating a gold price in U.S. Dollars, at which the auction round will be conducted. An auction round lasts 30 seconds. Gold participants electronically place bid and offer orders at the round’s stated price and indicate whether the orders are for their own account or for the account of clients. Aggregate bid and offer volume will be shown live on WebICE, providing a level playing field for all participants.
At the end of the auction round, the IBA system evaluates the equilibrium of the bid and offer orders submitted. If bid and offer orders indicate an imbalance outside of acceptable tolerances established for the IBA system (normally 10,000 oz) (e.g., too many purchase orders submitted compared to sell orders or vice versa), the auction chairman calculates a new auction round price principally based on the volume weighting of bid and offer orders submitted in the immediately completed auction round. For instance, if the order imbalance indicates that purchase orders (bids) outweigh sales orders (offers) then a new auction round price will be issued that will be increased over that used in the prior auction round. Likewise, the new auction round price will be decreased from the prior round’s price if offers outweigh bids. To clear the imbalance, the IBA system then issues another notice of auction round to gold participants at the newly calculated price. During this next 30 second auction round, gold participants again submit orders, and after it ends, the IBA system evaluates for order imbalances. If order imbalances persist, a new auction price is calculated and a further auction round will occur. This auction round process continues until an equilibrium within specified tolerances is determined to exist. Once the IBA system determines that orders are in equilibrium within system tolerances, the auction process ends and the equilibrium auction round price becomes the LBMA PM Gold Price.
The LBMA PM Gold Price and all bid and offer order information for all auction rounds become publicly available electronically via IBA instantly after the conclusion of the equilibrium auction. Since April 1, 2015, the LBMA Gold Price has been regulated by the Financial Conduct Authority (“FCA”) in the United Kingdom (“UK”). IBA also has an Oversight Committee, made up of market participants, industry bodies, direct participant representatives, infrastructure providers and IBA. The Oversight Committee allows the LBMA to continue to have significant involvement in the oversight of the auction process, including, among other matters, changes to the methodology and accreditation of direct participants. Additionally, IBA watches over the price discovery process for the LBMA Gold Price and ensures that it meets the International Organization of Securities Commission’s (IOSCO) Principles for Financial Benchmarks (the “IOSCO Principles”).
The LBMA PM Gold Price is widely viewed as a full and fair representation of all or material market interest at the conclusion of the equilibrium auction. IBA’s LBMA PM Gold Price electronic auction methodology is similar to the non-electronic process previously used to establish the London gold fix where the London gold fix process adjusted the gold price up or down until all the buy and sell orders are matched, at which time the price was declared fixed. Nevertheless, the LBMA PM Gold Price has several advantages over the previous London gold fix. The LBMA PM Gold Price auction process is fully transparent in real time to the gold participants and, at the close of each equilibrium auction, to the general public.
The LBMA PM Gold Price auction process is also fully auditable by third parties since an audit trail exists from the time of each notice of an auction round. Moreover, the LBMA PM Gold Price’s audit trail and active, real time surveillance of the auction process by IBA as well as FCA’s oversight of IBA, deters manipulative and abusive conduct in establishing each day’s LBMA PM Gold Price.
Since March 20, 2015, the Sponsor determined that the London gold fix, which ceased to be published as of March 19, 2015, could no longer serve as a basis for valuing gold bullion received upon purchase of the Trust’s Shares, delivered upon redemption of the Trust’s Shares and otherwise held by the Trust on a daily basis, and that the LBMA PM Gold Price is an appropriate alternative for determining the value of the Trust’s gold each trading day. The Sponsor also determined that the LBMA Gold Price PM fairly represents the commercial value of gold bullion held by the Trust and the “Benchmark Price” (as defined in Trust Agreement) as of any day is such day’s LBMA Gold Price PM or such day’s LBMA Gold Price AM if such day’s LBMA Gold Price PM is not available.
14
Futures Exchanges
The most significant gold futures exchanges are the COMEX, a designated contract market within the CME Group, and the Tokyo Commodity Exchange (“TOCOM”). The COMEX is the largest exchange in the world for trading precious metals futures and options and has been trading gold since 1974. The TOCOM has been trading gold since 1982. Trading on these exchanges is based on fixed delivery dates and transaction sizes for the futures and options contracts traded. Trading costs are negotiable. As a matter of practice, only a small percentage of the futures market turnover ever comes to physical delivery of the gold represented by the contracts traded. Both exchanges permit trading on margin. Margin trading can add to the speculative risk involved given the potential for margin calls if the price moves against the contract holder. The COMEX trades gold futures almost continuously (with one short break in the evening) through its CME Globex electronic trading system and clears through its central clearing system. On June 6, 2003, TOCOM adopted a similar clearing system. In each case, the exchange acts as a counterparty for each member for clearing purposes.
Other Exchanges
There are other gold exchange markets, such as the Istanbul Gold Exchange (trading gold since 1995), the Shanghai Gold Exchange (trading gold since 2002), the Hong Kong Chinese Gold & Silver Exchange Society (trading gold since 1918) and the Singapore Mercantile Exchange (trading gold since 2010).
The Silver Market
The London Silver Bullion Market
Although the market for physical silver is distributed globally, most OTC market trades are cleared through London. In addition to coordinating market activities, the LBMA acts as the principal point of contact between the market and its regulators. A primary function of the LBMA is its involvement in the promotion of refining standards by maintenance of the “Good Delivery List,” which is a list of LBMA accredited refiners of silver. The LBMA also coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation.
The term “loco London” silver refers to silver physically held in London that meets the specifications for weight, dimensions, fineness (or purity), identifying marks (including the assay stamp of a LBMA acceptable refiner) and appearance set forth in “The Good Delivery Rules for Gold and Silver Bars” published by the LBMA. Silver bars meeting these requirements are described in this report from time to time as “Silver Good Delivery Bars.” The unit of trade in London is the troy ounce, whose conversion between grams is: 1,000 grams equals 32.1507465 troy ounces and 1 troy ounce equals 31.1034768 grams. A Silver Good Delivery Bar is acceptable for delivery in settlement of a transaction on the OTC market. A Silver Good Delivery Bar must contain between 750 troy ounces and 1,100 troy ounces of silver with a minimum fineness (or purity) of 999.0 parts per 1,000. A Silver Good Delivery Bar must also bear the stamp of one of the refiners who are on the LBMA-approved list. Unless otherwise specified, the silver spot price always refers to that of a Silver Good Delivery Bar. Business is generally conducted over the phone and through electronic dealing systems.
On July 14, 2017, the LBMA announced that ICE Benchmark Administration (“IBA”) had been selected to be the third-party administrator for the “LBMA Silver Price”. Effective from October 2, 2017, IBA is providing the auction platform and methodology as well as the overall administration and governance for the LBMA Silver Price benchmark. IBA operates an “equilibrium auction”, which is an electronic, tradable and auditable, over-the-counter auction for LBMA-authorized participating silver bullion banks or market makers and sponsored clients of direct participants (“silver participants”) that establishes a reference silver price for that day’s trading, often referred to as the “LBMA Silver Price”. The LBMA Silver Price equilibrium auction operated by CME Group Inc. and Refinitiv prior to October 2, 2017 was selected by the LBMA as the silver valuation replacement for the London silver fix previously determined by the London Silver Market Fixing Ltd. that was discontinued on August 14, 2014. The LBMA Silver Price has become a widely used benchmark for daily silver prices and is quoted by various financial information sources as the London silver fix was previously.
The LBMA Silver Price is the result of an “equilibrium auction” because it establishes a price for a troy ounce of Silver Good Delivery Bars that clears the maximum amount of bids and offers for silver entered by order-submitting silver participants each day. IBA uses ICE’s front-end system, WebICE, as the technology platform that allows direct participants, as well as sponsored clients of direct participants, to manage their orders in the auction in real time via their own desktops. As the IBA electronic silver auction market develops, IBA expects to admit additional silver participants to the order submission process. The benchmark is published when the auction finishes, typically a few minutes after 12:00 noon (London time).
At the opening of each auction, IBA in the role of auction chairman (“Chairman”) announces an opening price (in U.S. Dollars), that takes into account current market conditions and begins auction rounds, with an expected duration of at least 30 seconds each. During each auction round, participants may enter the volume they wish to buy or sell at that price, and such orders will be part of the price formation. Aggregate bid and offer volume is shown live on WebICE. At the end of each auction round, the total net volume is calculated. If this “imbalance” is larger than the imbalance tolerance (normally 500,000 oz.) then the Chairman sets a new price (based on the current market conditions, and the direction and magnitude of the imbalance in the round) and begins a new auction round. If the imbalance is less than the tolerance, then the auction is complete with all volume tradeable at that price. The price is then set in U.S. Dollars and also converted into other currencies, including Australian Dollars, British Pounds, Canadian Dollars, Euros, Onshore and Offshore Yuan, Indian Rupees, Japanese Yen, Malaysian Ringgit, Russian Rubles, Singapore Dollars, South African Rand, Swiss Francs, New Taiwan Dollars, Thai Baht and Turkish Lira. The auction is run at 12:00 noon (London time).
15
During the auction, the price at the start of each round, and the volumes at the end of each round are available through major market data vendors. As soon as the auction finishes, the final prices and volumes are available through major market data vendors. IBA also publishes transparency reports, detailing the prices, volumes and times for each round of the auction. These transparency reports are available through major market data vendors and IBA when the auction finishes. The process can also be observed real-time through a WebICE screen. The auction mechanism provides a complete audit trail.
There are currently thirteen direct participants who have been accredited to contribute to the LBMA Silver Price: Citibank N.A. London Branch, Coins ‘N Things Inc., DRW Investments, LLC, Goldman Sachs International plc, HSBC Bank USA NA, Jane Street Global Trading LLC, JP Morgan Chase Bank N.A London Branch, Koch Supply and Trading LP, Marex, Morgan Stanley, Standard Chartered Bank, StoneX Financial Ltd. and The Toronto Dominion Bank.
Since April 1, 2015, the LBMA Silver Price has been regulated by the FCA in the UK. IBA is authorized as a regulated benchmark administrator by the FCA. Under the UK benchmark regulation, the governance structure for a regulated benchmark must include an Oversight Committee, made up of market participants, industry bodies, direct participant representatives, infrastructure providers and the administrator (i.e., IBA). Through the Oversight Committee the LBMA continues to have significant involvement in the oversight of the auction process, including, among other matters, changes to the methodology and accreditation of direct participants. The price discovery process for the LBMA Silver Price is subject to surveillance by IBA. IBA has been formally assessed against the IOSCO Principles. In order to meet the IOSCO Principles, the price discovery used for the LBMA Silver Price benchmark is auditable and transparent.
The LBMA Silver Price is viewed as a full and fair representation of all market interest at the conclusion of the auction. IBA’s auction process is similar to CME Group’s auction process, which in turn was similar to the non-electronic process previously used to establish the London silver fix where the London silver fix process adjusted the silver price up or down until all the buy and sell orders are matched, at which time the price was declared fixed. Nevertheless, the LBMA Silver Price has several advantages over the previous London silver fix. IBA’s auction process is fully transparent in real-time to direct participants and sponsored clients and, at the close of each auction, to the general public. IBA’s auction process is also fully auditable since an audit trail exists for every change made in the process. Moreover, the audit trail and active surveillance of the auction process by IBA, as well as the FCA’s oversight of IBA, deters manipulative and abusive conduct in establishing each day’s LBMA Silver Price.
Since August 15, 2014, the Sponsor determined that the London silver fix, which ceased to be published as of that date, would be an inappropriate basis for valuing silver bullion received upon purchase of the Trust’s Shares, delivered upon redemption of the Trust’s Shares and otherwise held by the Trust on a daily basis, and that the LBMA Silver Price is an appropriate alternative for determining the value of the Trust’s silver each trading day. The Sponsor also determined that the LBMA Silver Price fairly represents the commercial value of silver bullion held by the Trust and that the “Benchmark Price” (as defined in the Trust Agreement) as of any day is the LBMA Silver Price for such day.
Futures Exchanges
The most significant silver futures exchanges are the COMEX and the TOCOM. Futures exchanges seek to provide a neutral, regulated marketplace for the trading of derivatives contracts for commodities. Futures contracts are defined by the exchange for each commodity. For each commodity traded, this contract specifies the precise quality and quantity standards. The contract’s terms and conditions also define the location and timing of physical delivery.
An exchange does not buy or sell those contracts, but seeks to offer a transparent forum where members, on their own behalf or on the behalf of customers, can trade the contracts in a safe, efficient and orderly manner. During regular trading hours at the COMEX, the commodity contracts are traded on CME Globex system, an electronic auction in which all bids, offers and trades must be publicly announced to all members and, upon execution, centrally cleared. Electronic trading is offered by the exchange almost 24 hours a day (except for a short break in the evening), six days a week.
In addition to the public nature of the pricing, futures exchanges in the United States are regulated at two levels: internal and external governmental supervision. The internal is performed through self-regulation and consists of regular monitoring of the following: the central algorithmic matching process to ensure that it is conducted in conformance with all exchange rules; the orderly trading and settlement of futures and options; the financial condition of all exchange member firms to ensure that they continuously meet financial commitments; and the volume positions of commercial and non-commercial customers to ensure that physical delivery and other commercial commitments can be met, and that pricing is not being improperly affected by the size of any particular customer positions. External governmental oversight is performed by the CFTC, which reviews all the rules and regulations of United States futures exchanges and clearing houses and monitors their enforcement.
16
The Platinum Market
The Zurich and London Platinum Bullion Markets
Although the market for physical platinum is distributed globally, most platinum is stored and most OTC market trades are cleared through London and Zurich. In addition to coordinating market activities, the LPPM acts as the principal point of contact between the market and its regulators. A primary function of the LPPM is its involvement in the promotion of refining standards by maintenance of the “London/Zurich Good Delivery Lists,” which are the lists of LPPM accredited refiners of platinum. The LPPM also coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation.
Platinum is traded generally on a “loco London” or “loco Zurich” basis, meaning the precious metal is physically held in vaults in London or Zurich or is transferred into accounts established in London or Zurich. Delivery of the platinum can either be by physical delivery or through the clearing systems to an unallocated account.
The unit of trade in London and Zurich is the troy ounce, whose conversion between grams is: 1,000 grams equals 32.1507465 troy ounces, and one troy ounce is equivalent to 31.1034768 grams. A good delivery platinum plate or ingot on the LPPM approved list is acceptable for delivery in settlement of a transaction on the OTC market (a “Good Delivery Platinum Plate or Ingot”). A Good Delivery Platinum Plate or Ingot must contain between 32 and 192.904 troy ounces of platinum with a minimum fineness (or purity) of 999.5 parts per 1,000 (99.95%), be of good appearance, and be easy to handle and stack. The platinum content of a platinum Good Delivery Platinum Plate or Ingot is calculated by multiplying the gross weight by the fineness of the plate or ingot. A Good Delivery Platinum Plate or Ingot must also bear the stamp of one of the refiners who are on the LPPM approved list. Unless otherwise specified, the platinum spot price always refers to the “Good Delivery Standards” set by the LPPM. Business is generally conducted over the phone and through electronic dealing systems.
Since December 1, 2014, the LME has been administering the operation of an electronic platinum bullion price fixing system (“LMEbullion”) that replicates electronically the manual London platinum fix processes previously employed by the London Platinum and Palladium Fixing Company Ltd (“LPPFCL”), as well as providing electronic market clearing processes for platinum bullion transactions at the fixed prices established by the LME pricing mechanism. The LME’s electronic price fixing processes, like the previous London platinum fix processes, establishes and publishes fixed prices for troy ounces of platinum twice each London trading day during fixing sessions beginning at 9:45 a.m. London time (the “LBMA Price AM”) and 2:00 p.m. London time (the “LBMA Price PM”). In addition to utilizing the same London platinum fix standards and methods, the LME also supervises the platinum electronic price fixing processes through its market operations, compliance, internal audit and third-party complaint handling capabilities in order to support the integrity of the LBMA Price PM. The LME, in administering LMEbullion, uses a pricing methodology that meets the administrative and regulatory needs of platinum market participants, including the IOSCO Principles. In January 2026, the LBMA announced that it intends to appoint ICE Benchmark Administration (“IBA”) to replace the LME as the third-party administrator of the LBMA Platinum and Palladium prices in mid-2026.
Daily during London trading hours the LBMA Price AM and the LBMA Price PM each provide reference platinum prices for that day’s trading. Many long-term contracts will be priced on the basis of either the LBMA Price AM or the LBMA Price PM, and market participants will usually refer to one or the other of these prices when looking for a basis for valuations. The Trust values its platinum on the basis of the LBMA Price PM. If there is no LBMA Price PM on any day, the Trust will value its platinum on the basis of LBMA Price AM announced on that day. If neither price is available for that day, the Trust will value its platinum based on the most recently announced LBMA Price PM price or LBMA Price AM price.
Formal participation in the LBMA Price PM is limited to participating LPPM members. Five LPPM members are currently participating in establishing the LBMA Price PM (Goldman Sachs International, HSBC Bank USA NA, ICBC Standard Bank plc, Johnson Matthey plc and BASF Metals Ltd.). Any other market participant wishing to participate in the trading on the LBMA Price PM is required to do so through one of the participating LPPM members.
Orders are placed either with one of the participating LPPM member participants or with another precious metals dealer who will then be in contact with a participating LPPM member during the fixing. The fix begins with the chair reflecting the market price and other data, prevailing at the opening of the fix. This is relayed by the LPPM member participants to their dealing rooms which have direct communication with all interested parties. Any member participant may enter the fixing process at any time, or adjust or withdraw his order. The platinum price is adjusted up or down until all the buy and sell orders are electronically matched, at which time the price is declared fixed. All orders are transacted on the basis of this fixed price, which is instantly relayed to the market through various media.
The LBMA and the LME have asserted that the LME’s electronic price fixing processes are similar to the non-electronic processes previously used to establish the applicable London platinum fix where the London platinum fix process adjusted the platinum price up or down until all the buy and sell orders entered by the participating LPPM members are matched, at which time the price was declared fixed. Nevertheless, the LBMA Price PM has several advantages over the previous London platinum fix. The LME’s electronic price fixing processes are intended to be transparent. The LME asserts that its electronic price fixing processes are fully auditable by third parties since an audit trail exists from the beginning of each fixing session. The LME also asserts that the market operation, compliance, internal audit and third-party complaint handling capabilities of the LME supports the integrity of the LBMA Price PM.
17
Since December 1, 2014, the Sponsor determined that the London platinum fix, which has been revised based on the new LME method and is now known as the LBMA Platinum Price (PM), which we refer to herein as the LBMA Price PM, is an appropriate basis for valuing platinum bullion received upon purchase of the Trust’s Shares, delivered upon redemption of the Trust’s Shares and for determining the value of the Trust’s platinum bullion each trading day. The Sponsor also has determined that the LBMA Platinum Price PM will fairly represent the commercial value of platinum bullion held by the Trust and, the “Benchmark Price” (as defined in the Trust Agreement) of the Trust’s platinum bullion as of any day is the LBMA Price PM for such day.
As of December 1, 2014, the LPPFCL transferred the ownership of the historic and future intellectual property of the twice daily “fix” for platinum and palladium bullion to a subsidiary company of the LBMA.
Futures Exchanges
The most significant platinum futures exchanges are the COMEX and the TOCOM. The COMEX is the largest exchange in the world for trading precious metals futures and options and launched platinum futures in 1956, followed with options in 1990. The TOCOM has been trading platinum since 1984. Trading on these exchanges is based on fixed delivery dates and transaction sizes for the futures and options contracts traded. Trading costs are negotiable. As a matter of practice, only a small percentage of the futures market turnover ever comes to physical delivery of the platinum represented by the contracts traded. Both exchanges permit trading on margin. Margin trading can add to the speculative risk involved given the potential for margin calls if the price moves against the contract holder. The COMEX trades platinum futures almost continuously (with one short break in the evening) through its CME Globex electronic trading system and clears through its central clearing system. On June 6, 2003, the TOCOM adopted a similar clearing system. In each case, the exchange acts as a counterparty for each member for clearing purposes.
The Palladium Market
The Zurich and London Palladium Bullion Markets
Although the market for physical palladium is distributed globally, most palladium is stored and most OTC market trades are cleared through Zurich. As of September 1, 2009, London also serves as a center for the clearing of OTC trades in palladium. In addition to coordinating market activities, the LPPM acts as the principal point of contact between the market and its regulators. A primary function of the LPPM is its involvement in the promotion of refining standards by maintenance of the “London/Zurich Good Delivery Lists,” which are the lists of LPPM accredited refiners of palladium. The LPPM also coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation.
Palladium is traded generally on a loco Zurich basis, meaning the precious metal is physically held in vaults in Zurich or is transferred into accounts established in Zurich. As of September 1, 2009, palladium began trading on a loco London basis as well, meaning that the precious metal is physically held in vaults in London or is transferred into accounts established in London. The basis for settlement and delivery of a loco Zurich spot trade is payment (generally in U.S. Dollars) two business days after the trade date against delivery.
Delivery of the palladium can either be by physical delivery or through the clearing systems to an unallocated account.
The unit of trade in London and Zurich is the troy ounce, whose conversion between grams is: 1,000 grams equals 32.1507465 troy ounces, and one troy ounce equals 31.1034768 grams. A good delivery palladium plate or ingot on the LPPM approved list is acceptable for delivery in settlement of a transaction on the OTC market (a “Good Delivery Plate or Ingot”). A Good Delivery Plate or Ingot must contain between 32 and 192 troy ounces of palladium with a minimum fineness (or purity) of 999.5 parts per 1,000 (99.95%), be of good appearance, and be easy to handle and stack. The palladium content of a palladium plate or ingot is calculated by multiplying the gross weight by the fineness of the plate or ingot. A Good Delivery Plate or Ingot must also bear the stamp of one of the refiners who are on the LPPM approved list. Unless otherwise specified, the palladium spot price always refers to that of “Good Delivery Standards” set by the LPPM. Business is generally conducted over the phone and through electronic dealing systems.
Since December 1, 2014, the LME has been administering the operation of electronic palladium bullion price fixing system (“LMEbullion”) that replicate electronically the manual London palladium fix processes previously employed by the London Platinum and Palladium Fixing Company Ltd (“LPPFCL”) as well as providing electronic market clearing processes for palladium bullion transactions at the fixed prices established by the LME pricing mechanism. The LME’s electronic price fixing processes, like the previous London palladium fix processes, establishes and publishes fixed prices for troy ounces of palladium twice each London trading day during fixing sessions beginning at 9:45 a.m. London time (the LBMA Price AM) and 2:00 p.m. London time (the LBMA Price PM). In addition to utilizing the same London palladium fix standards and methods, the LME also supervises the palladium electronic price fixing processes through its market operations, compliance, internal audit and third-party complaint handling capabilities in order to support the integrity of the LBMA Price PM. The LME, in administering LMEbullion, uses a pricing methodology that meets the administrative and regulatory needs of palladium market participants, including the International Organization of Securities Commission’s (IOSCO) Principles for Financial Benchmarks.
18
Daily during London trading hours the LBMA Price AM and the LBMA Price PM each provide reference palladium prices for that day’s trading. Many long-term contracts will be priced on the basis of either the LBMA Price AM or the LBMA Price PM, and market participants will usually refer to one or the other of these prices when looking for a basis for valuations. The Trust values its palladium on the basis of the LBMA Price PM. If there is no LME Price PM on any day, the Trust will value its palladium on the basis of LBMA Price AM announced on that day. If neither price is available for that day, the Trust will value its palladium based on the most recently announced LBMA Price PM price or LBMA Price AM price.
Formal participation in the LBMA Price PM is limited to participating LPPM members. Five LPPM members are currently participating in establishing the LBMA Price PM (Goldman Sachs International, HSBC Bank USA NA, ICBC Standard Bank plc, Johnson Matthey plc and BASF Metals Ltd.). Any other market participant wishing to participate in the trading on the LBMA Price PM is required to do so through one of the participating LPPM members.
Orders are placed either with one of the participating LPPM member participants or with another precious metals dealer who will then be in contact with a participating LPPM member during the fixing. The fix begins with the chair reflecting the market price and other data, prevailing at the opening of the fix. This is relayed by the LPPM member participants to their dealing rooms which have direct communication with all interested parties. Any market member may enter the fixing process at any time, or adjust or withdraw his order. The palladium price is adjusted up or down until all the buy and sell orders are electronically matched, at which time the price is declared fixed. All fixing orders are transacted on the basis of this fixed price, which is instantly relayed to the market through various media.
The LBMA and the LME have asserted that the LME’s electronic price fixing processes are similar to the non-electronic processes previously used to establish the applicable London palladium fix where the London palladium fix process adjusted the palladium price up or down until all the buy and sell orders entered by the participating LPPM members are matched, at which time the price was declared fixed. Nevertheless, the LBMA Price PM has several advantages over the previous London palladium fix. The LME’s electronic price fixing processes are intended to be transparent. The LME asserts that its electronic price fixing processes are fully auditable by third parties since an audit trail exists from the beginning of each fixing session. The LME also asserts that the market operation, compliance, internal audit and third-party complaint handling capabilities of the LME supports the integrity of the LBMA Price PM.
Since December 1, 2014, the Sponsor determined that the London palladium fix, which has been revised based on the new LME method and is now known as the LBMA Price PM, is an appropriate basis for valuing palladium bullion received upon purchase of the Trust’s Shares, delivered upon redemption of the Trust’s Shares and for determining the value of the Trust’s palladium bullion each trading day. The Sponsor also has determined that the LBMA Price PM will fairly represent the commercial value of palladium bullion held by the Trust and, the “Benchmark Price” (as defined in the Trust Agreement) of the Trust’s palladium bullion as of any day is the LBMA Price PM for such day.
As of December 1, 2014, the LPPFCL transferred ownership of the historic and future intellectual property of the twice daily “fix” for platinum and palladium bullion to a subsidiary company of the LBMA.
Futures Exchanges
The most significant palladium futures exchanges are the COMEX and the TOCOM. The COMEX is the largest exchange in the world for trading precious metals futures and options and launched palladium futures in 1968, followed with options in 2010. The TOCOM has been trading palladium since 1992. Trading on these exchanges is based on fixed delivery dates and transaction sizes for the futures and options contracts traded. Trading costs are negotiable. As a matter of practice, only a small percentage of the futures market turnover ever comes to physical delivery of the palladium represented by the contracts traded. Both exchanges permit trading on margin. Margin trading can add to the speculative risk involved given the potential for margin calls if the price moves against the contract holder. The COMEX trades palladium futures almost continuously (with one short break in the evening) through its CME Globex electronic trading system and clears through its central clearing system. On June 6, 2003, the TOCOM adopted a similar clearing system. In each case, the exchange acts as a counterparty for each member for clearing purposes.
Market Regulation
The global gold, silver, platinum and palladium markets are overseen and regulated by both governmental and self-regulatory organizations. In addition, certain trade associations have established rules and protocols for market practices and participants. In the United Kingdom, responsibility for the regulation of the financial market participants, including the major participating members of the LBMA and the LPPM, falls under the authority of the FCA as provided by the Financial Services and Markets Act 2000 (“FSM Act”). Under this act, all UK-based banks, together with other investment firms, are subject to a range of requirements, including fitness and properness, capital adequacy, liquidity, and systems and controls.
19
The FCA is responsible for regulating investment products, including derivatives, and those who deal in investment products. Regulation of spot, commercial forwards, and deposits of gold, silver, platinum and palladium not covered by the FSM Act is provided for by The London Code of Conduct for Non-Investment Products, which was established by market participants in conjunction with the Bank of England.
The TOCOM has authority to perform financial and operational surveillance on its members’ trading activities, scrutinize positions held by members and large-scale customers, and monitor the price movements of futures markets by comparing them with cash and other derivative markets’ prices. To act as a Futures Commission Merchant Broker on the TOCOM, a broker must obtain a license from Japan’s Ministry of Economy, Trade and Industry (“METI”), the regulatory authority that oversees the operations of the TOCOM.
The CFTC regulates trading in commodity contracts, such as futures, options and swaps. In addition, under the CEA, the CFTC has jurisdiction to prosecute manipulation and fraud in any commodity (including precious metals) traded in interstate commerce as spot as well as deliverable forwards. The CFTC is the exclusive regulator of U.S. commodity exchanges and clearing houses.
Secondary Market Trading
While the Trust’s investment objective is for the Shares to reflect the performance of the prices of physical gold, silver, platinum and palladium, in the proportions held by the Trust, less the Trust’s expenses, the Shares may trade in the secondary market on the NYSE Arca at prices that are lower or higher relative to their net asset value (the value of the Trust’s assets less its liabilities (“NAV”)) per Share. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by non-concurrent trading hours between the NYSE Arca, COMEX and the London and Zurich gold, silver, platinum and palladium markets. While the Shares trade on the NYSE Arca until 4:00 PM New York time, liquidity in the global bullion markets is reduced after the close of the COMEX at 1:30 PM New York time. As a result, during this time, trading spreads, and the resulting premium or discount, on the Shares may widen.
Valuation of Bullion and Computation of Net Asset Value
On each day that the NYSE Arca is open for regular trading, as promptly as practicable after 4:00 p.m., New York time, on such day (“Evaluation Time”), the Trustee will evaluate the Bullion held by the Trust and determine both the ANAV and the NAV of the Trust.
At the Evaluation Time, the Trustee will value (1) the gold held by the Trust based on the LBMA Gold Price PM for an ounce of gold, or such day’s LBMA Gold Price AM if such day’s LBMA Gold Price PM is not available, (2) the silver held by the Trust based on the LBMA Silver Price for an ounce of silver, (3) the platinum held by the Trust based on the LBMA Price PM price for a troy ounce of platinum, or such day’s LBMA Price AM if such day’s LBMA Price PM is not available, and (4) the palladium held by the Trust based on the LBMA Price PM price for a troy ounce of palladium or such day’s LBMA Price AM if such day’s LBMA Price PM is not available. If the London Metal Price referenced above is not available or has not been announced by the Evaluation Time, for any Bullion metal, the next most recent London Metal Price announced for such metal determined prior to the Evaluation Time will be used, unless the Sponsor determines that such price is inappropriate as a basis for evaluation.
Once the value of the gold, silver, platinum and palladium has been determined, the Trustee subtracts all estimated accrued but unpaid fees (other than the fees accruing for such day on which the valuation takes place which are computed by reference to the value of the Trust or its assets), expenses and other liabilities of the Trust from the total value of the Bullion and any other assets of the Trust. The resulting figure is the ANAV of the Trust. The ANAV of the Trust is used to compute the Sponsor’s Fee.
All fees accruing for the day on which the valuation takes place which are computed by reference to the value of the Trust or its assets are calculated using the ANAV calculated for such day. The Trustee subtracts from the ANAV the amount of accrued fees so computed for such day and the resulting figure is the NAV of the Trust. The Trustee also determines the NAV per Share by dividing the NAV of the Trust by the number of the Shares outstanding as of the close of trading on the NYSE Arca (which includes the net number of any Shares created or redeemed on such evaluation day).
Any estimate of the accrued but unpaid fees, expenses and liabilities of the Trust for purposes of computing the NAV of the Trust and ANAV made by the Trustee in good faith shall be conclusive upon all persons interested in the Trust and no revision or correction in any computation made under the Trust Agreement will be required by reason of any difference in amounts estimated from those actually paid.
The Sponsor and the Shareholders (as defined below) may rely on any evaluation furnished by the Trustee, and the Sponsor has no responsibility for the evaluation’s accuracy. The determinations the Trustee makes will be made in good faith upon the basis of, and the Trustee will not be liable for any errors contained in, information reasonably available to it. The Trustee will not be liable to the Sponsor, The Depository Trust Company (“DTC”), Authorized Participants, the Shareholders or any other person for errors in judgment. However, the preceding liability exclusion will not protect the Trustee against any liability resulting from bad faith or gross negligence in the performance of its duties.
20
On May 23, 2024, the Sponsor entered into an Amendment (the “Trust Amendment”) to the Depositary Trust Agreement (the “Trust Agreement”) with the Trustee. The Trust Amendment reflects the following changes, effective as of June 18, 2024, as approved and directed by the Sponsor on behalf of the Trust: (1) the amendment of the definition of “Benchmark Price” to mean, “as of any day, as applicable (i) such day’s LBMA Price PM or such day’s LBMA Price AM if such day’s LBMA Price PM is not available, for Gold, Platinum or Palladium, or such day’s LBMA Silver Price for Silver; or (ii) such other publicly available price which is reasonably available to the Trustee and which the Sponsor may determine fairly represents the commercial value of Gold, Silver, Platinum or Palladium held by the Trust and instructs the Trustee to use as the Benchmark Price”; (2) the deletion and replacement of the defined term for “London Fix” with the defined term “LBMA Silver Price”, which means “the price of a troy ounce of silver as determined by ICE Benchmark Administration, the third party administrator of the London silver price selected by the LBMA, or any successor administrator of the London silver price, at or about 12:00 p.m. London, England time”; (3) the deletion and replacement of the defined term for “London PM Fix” with the defined term “LBMA Price PM”, which means “the price of a troy ounce of (i) Gold as determined by ICE Benchmark Administration, the third party administrator of the London gold price selected by the LBMA, or any successor administrator of the London gold price, at or about 3:00 p.m. London, England time, (ii) Platinum as determined by as determined by the LME, the third party administrator of the London platinum price selected by the LBMA, or any successor administrator of the London platinum price, at or about 2:00 p.m. London, England time, or (iii) Palladium as determined by the LME, the third party administrator of the London palladium price selected by the LBMA, or any successor administrator of the London palladium price, at or about 2:00 p.m. London, England time”; and (4) the addition of the new definition for “LBMA Price AM” which means “the price of a troy ounce of (i) Gold as determined by ICE Benchmark Administration, the third party administrator of the London gold price selected by the LBMA, or any successor administrator of the London gold price, at or about 10:30 a.m. London, England time, (ii) Platinum as determined by as determined by the LME, the third party administrator of the London platinum price selected by the LBMA, or any successor administrator of the London platinum price, at or about 9:45 a.m. London, England time, or (iii) Palladium as determined by the LME, the third party administrator of the London palladium price selected by the LBMA, or any successor administrator of the London palladium price, at or about 9:45 a.m. London, England time.
Trust Expenses
The Trust’s only ordinary recurring expense is the Sponsor’s Fee. In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume the following administrative and marketing expenses incurred by the Trust: the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and reimbursement of the Custodian’s expenses under the Custody Agreements (defined below), Exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses. The Sponsor also paid the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.
The Sponsor’s Fee accrues daily at an annualized rate equal to 0.60% of the ANAV of the Trust and is payable monthly in arrears. The Sponsor, from time to time, may temporarily waive all or a portion of the Sponsor’s Fee at its discretion. Presently, the Sponsor does not intend to waive any of its fee.
Furthermore, the Sponsor may, in its sole discretion, agree to rebate all or a portion of the Sponsor’s Fee attributable to Shares held by certain institutional investors subject to minimum shareholding and lock up requirements as determined by the Sponsor to foster stability in the Trust’s asset levels. Any such rebate will be subject to negotiation and written agreement between the Sponsor and the investor on a case by case basis. The Sponsor is under no obligation to provide any rebates of the Sponsor’s Fee. Neither the Trust nor the Trustee will be a party to any Sponsor’s Fee rebate arrangements negotiated by the Sponsor. Any Sponsor’s Fee rebate shall be paid from the funds of the Sponsor and not from the assets of the Trust.
The Sponsor’s Fee is paid by delivery of Bullion to an account maintained by the Custodian for the Sponsor on an unallocated basis, monthly on the first business day of the month in respect of fees payable for the prior month. The delivery is of that number of ounces of gold, silver, platinum and palladium which equals the daily accrual of the Sponsor’s Fee for such prior month calculated at the applicable London Metal Price. The gold, silver, platinum and palladium delivered to pay the Sponsor’s Fee shall be in such proportion so as to ensure that the Bullion held by the Trust following such transfer is in the same ratio of metals as the Bullion delivered for the Creation Basket Deposits.
The Trustee will, when directed by the Sponsor, and, in the absence of such direction, may, in its discretion, sell Bullion in such quantity and at such times as may be necessary to permit payment in cash of Trust expenses not assumed by the Sponsor. The Trustee is authorized to sell Bullion at such times and in the smallest amounts required to permit such payments as they become due, it being the intention to avoid or minimize the Trust’s holdings of assets other than Bullion. Accordingly, the amount of Bullion to be sold will vary from time to time depending on the level of the Trust’s expenses and the market prices of Bullion. The Custodian is authorized to purchase from the Trust, at the request of the Trustee, Bullion needed to cover Trust expenses not assumed by the Sponsor at the prices used by the Trustee to determine the value of the Bullion held by the Trust on the date of the sale.
The Sponsor’s Fee for the year ended December 31, 2025 was $9,539,023 (December 31, 2024: $6,060,263; December 31, 2023: $5,919,545).
21
Cash held by the Trustee pending payment of the Trust’s expenses will not bear any interest. Each delivery or sale of Bullion by the Trust to pay the Sponsor’s Fee or other Trust expenses will be a taxable event to Shareholders.
Creation and Redemption of Shares
The Trust creates and redeems Shares from time to time, but only in one or more Baskets (a Basket equals a block of 25,000
Shares). The creation and redemption of Baskets is only made in exchange for the delivery to the Trust or the distribution by the Trust of the amount of physical gold, silver, platinum and palladium and any cash represented by the Baskets being created or redeemed, the amount of which is based on the combined NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received.
Authorized Participants are the only persons that may place orders to create and redeem Baskets. Authorized Participants must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, which are not required to register as broker-dealers to engage in securities transactions, and (2) participants in DTC. To become an Authorized Participant, a person must enter into an Authorized Participant Agreement with the Sponsor and the Trustee. The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of the Bullion and any cash required for such creations and redemptions. The Authorized Participant Agreement and the related procedures attached thereto may be amended by the Trustee and the Sponsor, without the consent of any Shareholder or Authorized Participant. Authorized Participants pay a transaction fee of $500 to the Trustee for each order they place to create or redeem one or more Baskets. Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from either the Sponsor or the Trust for serving as an Authorized Participant, and no such person has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.
Authorized Participants are cautioned that some of their activities will result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus-delivery and liability provisions of the Securities Act, as described in “Plan of Distribution”.
Prior to initiating any creation or redemption order, an Authorized Participant must have entered into an agreement with the Custodian or a Bullion clearing bank to establish an Authorized Participant Unallocated Account in London (“Authorized Participant Unallocated Bullion Account Agreement”). Authorized Participant Unallocated Accounts may only be used for transactions with the Trust. Bullion held in Authorized Participant Unallocated Accounts is typically not segregated from the Custodian’s or other Bullion clearing bank’s assets, as a consequence of which an Authorized Participant will have no proprietary interest in any specific bars of gold or silver or plates or ingots of platinum or palladium held by the Custodian or the clearing bank. Credits to its Authorized Participant Unallocated Account are therefore at risk of the Custodian’s or other Bullion clearing bank’s insolvency. No fees will be charged by the Custodian for the use of the Authorized Participant Unallocated Account as long as the Authorized Participant Unallocated Account is used solely for Bullion transfers to and from the Trust Unallocated Account and the Custodian (or one of its affiliates) receives compensation for maintaining the Trust Allocated Account. Authorized Participants should be aware that the Custodian’s liability threshold under the Authorized Participant Unallocated Bullion Account Agreement is generally gross negligence, not negligence, which is the Custodian’s liability threshold under the Trust’s Custody Agreements.
As the terms of the Authorized Participant Unallocated Bullion Account Agreement differ in certain respects from the terms of the Trust’s Unallocated Account Agreement, potential Authorized Participants should review the terms of the Authorized Participant Unallocated Bullion Account Agreement carefully. A copy of the Authorized Participant Agreement may be obtained by potential Authorized Participants from the Trustee.
Certain Authorized Participants are expected to have the facility to participate directly in the physical gold, silver, platinum and palladium markets and the Bullion futures markets. In some cases, an Authorized Participant may from time to time acquire Bullion from or sell Bullion to its affiliated Bullion trading desk, which may profit in these instances. Each Authorized Participant must be registered as a broker-dealer under the Securities Exchange Act of 1934 ("Exchange Act") and regulated by FINRA or be exempt from being or otherwise not be required to be so regulated or registered, and must be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants are regulated under federal and state banking laws and regulations. Each Authorized Participant has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime.
Authorized Participants may act for their own accounts or as agents for broker-dealers, custodians and other securities market participants that wish to create or redeem Baskets. An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple clients. As of the date of this report, Goldman Sachs & Co., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Merrill Lynch Professional Clearing Corp., Mizuho Securities USA LLC, Morgan Stanley & Co., Inc, Scotia Capital (USA) LLC, UBS Securities LLC and Virtu Americas, LLC have each signed an Authorized Participant Agreement with the Trust and, upon the effectiveness of such agreement, may create and redeem Baskets as described above. Persons interested in purchasing Baskets should contact the Sponsor or the Trustee to obtain the contact information for the Authorized Participants. Shareholders who are not Authorized Participants are only able to redeem their Shares through an Authorized Participant.
22
All Bullion is be delivered to the Trust and distributed by the Trust in unallocated form through credits and debits between Authorized Participant Unallocated Accounts and the Trust Unallocated Account. Bullion transferred from an Authorized Participant Unallocated Account to the Trust in unallocated form will first be credited to the Trust Unallocated Account. Thereafter, the Custodian will allocate specific bars of gold and silver and allocate, specific plates or ingots of platinum, in each case representing the amount of Bullion credited to the Trust Unallocated Account (to the extent such amount is representable by whole gold or silver bars or platinum or palladium plates or ingots) to the Trust Allocated Account. The movement of Bullion is reversed for the distribution of Bullion to an Authorized Participant in connection with the redemption of Baskets.
All physical gold represented by a credit to any Authorized Participant Unallocated Account and to the Trust Unallocated Account and all physical gold held in the Trust Allocated Account with the Custodian must be of at least a minimum fineness (or purity) of 995 parts per 1,000 (99.5%) and otherwise conform to the rules, regulations practices and customs of the LBMA, including the specifications for a London Good Delivery Bar.
All physical silver represented by a credit to any Authorized Participant Unallocated Account and to the Trust Unallocated Account and all physical silver held in the Trust Allocated Account with the Custodian must be of at least a minimum fineness (or purity) of 999.0 parts per 1,000 (99.9%) and otherwise conform to the rules, regulations, practices and customs of the LBMA, including the specifications for a Silver Good Delivery Bar.
All physical platinum or palladium represented by a credit to any Authorized Participant Unallocated Account and to the Trust Unallocated Account and all physical platinum or palladium held in the Trust Allocated Account with the Custodian must be of at least a minimum fineness (or purity) of 999.5 parts per 1,000 (99.95%) and otherwise conform to the rules, regulations practices and customs of the LPPM, including the specifications for a Good Delivery Platinum Plate or Ingot or a Good Delivery Palladium Plate or Ingot, as applicable Under the Authorized Participant Agreement, the Sponsor has agreed to indemnify the Authorized Participants against certain liabilities, including liabilities under the Securities Act.
The following description of the procedures for the creation and redemption of Baskets is only a summary and an investor should refer to the relevant provisions of the Trust Agreement and the form of Authorized Participant Agreement for more detail.
Creation Procedures
On any business day, an Authorized Participant may place an order with the Trustee to create one or more Baskets. Creation and redemption orders are accepted on “business days” the NYSE Arca is open for regular trading. Settlements of such orders requiring receipt or delivery, or confirmation of receipt or delivery, of Bullion in the United Kingdom, or another jurisdiction will occur on “business days” when (1) banks in the United Kingdom, Zurich and such other jurisdiction and (2) the London and Zurich Bullion markets are regularly open for business. If such banks or the London or Zurich Bullion markets are not open for regular business for a full day, such a day will only be a “business day” for settlement purposes if the settlement procedures can be completed by the end of such day. Settlement of orders requiring receipt or delivery, or confirmation of receipt or delivery, of Shares will occur, after confirmation of the applicable Bullion delivery, on “business days” when the NYSE Arca is open for regular trading. In the event of a level 3 market-wide circuit breaker resulting in a trading halt for the remainder of the trading day, the time of the market-wide trading halt is considered the close of regular trading and no creation orders for the current trade date will be accepted after that time (the “cutoff”). Orders placed after the cutoff will be deemed to be rejected and will not be processed. Orders should be placed in proper form on the following business day. Purchase orders must be placed no later than 3:59:59 p.m. on each business day the NYSE Arca is open for regular trading.
By placing a purchase order, an Authorized Participant agrees to deposit Bullion with the Trust. Prior to the delivery of Baskets for a purchase order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the purchase order.
Determination of required deposits
The amount of gold, silver, platinum and palladium in the required deposit is determined by dividing the number of ounces of each metal held by the Trust by the number of Baskets outstanding, as adjusted for the amount of Bullion constituting estimated accrued but unpaid fees and expenses of the Trust. Fractions of a fine ounce of gold, silver, platinum and palladium smaller than 0.001 of a fine ounce which are included in the deposit amount are disregarded in the foregoing calculation. All questions as to the composition of a Creation Basket Deposit will be finally determined by the Trustee. The Trustee’s determination of the Creation Basket Deposit shall be final and binding on all persons interested in the Trust.
23
Delivery of required deposits
An Authorized Participant who places a purchase order is responsible for crediting its Authorized Participant Unallocated Account with the required Bullion deposit amount by the prescribed settlement date in London. Upon receipt of the Bullion deposit amount, the Custodian, after receiving appropriate instructions from the Authorized Participant and the Trustee, will transfer on the prescribed settlement date the Bullion deposit amount from the Authorized Participant Unallocated Account to the Trust Unallocated Account and the Trustee will direct DTC to credit the number of Baskets ordered to the Authorized Participant’s DTC account. The expense and risk of delivery, ownership and safekeeping of Bullion until such Bullion has been received by the Trust shall be borne solely by the Authorized Participant. The Trustee may accept delivery of Bullion by such other means as the Sponsor, from time to time, may determine with the Trustee to be acceptable for the Trust, provided that the same is disclosed in a prospectus relating to the Trust filed with the SEC pursuant to Rule 424 under the Securities Act. If Bullion is to be delivered other than as described above, the Sponsor is authorized to establish such procedures and to appoint such custodians and establish such custody accounts in addition to those described in this report, as the Sponsor determines to be desirable.
Acting on standing instructions given by the Trustee, the Custodian will transfer the Bullion deposit amount from the Trust Unallocated Account to the Trust Allocated Account by transferring gold and silver bars from its inventory and platinum and palladium plates and ingots from its inventory to the Trust Allocated Account. The Custodian uses commercially reasonable efforts to complete the transfer of Bullion to the Trust Allocated Account prior to the time by which the Trustee is to credit the Basket to the Authorized Participant’s DTC account; if, however, such transfers have not been completed by such time, the number of Baskets ordered will be delivered against receipt of the Bullion deposit amount in the Trust Unallocated Account, and all Shareholders will be exposed to the risks of unallocated Bullion to the extent of that Bullion deposit amount until the Custodian completes the allocation process. See “Risk Factors-Bullion held in the Trust’s unallocated Bullion account and any Authorized Participant’s unallocated Bullion account will not be segregated from the Custodian’s assets.”
Because gold and silver are allocated only in multiples of whole bars and platinum and palladium are only allocated in multiples of whole plates or ingots, the amount of Bullion allocated from the Trust Unallocated Account to the Trust Allocated Account may be less than the total fine ounces of Bullion credited to the Trust Unallocated Account. Any balance will be held in the Trust Unallocated Account. The Custodian uses commercially reasonable efforts to minimize the amount of Bullion held in the Trust Unallocated Account; no more than 430 troy ounces of gold (maximum weight to make one London Good Delivery Bar), no more than 1,100 troy ounces of silver (maximum weight to make one Silver Good Delivery Bar), no more than 192.904 troy ounces of platinum (maximum weight to make one Good Delivery Platinum Plate or Ingot) and no more than 192.904 troy ounces of palladium (maximum weight to make one Good Delivery Palladium Plate or Ingot) is expected to be held in the Trust Unallocated Account at the close of each business day.
Rejection of purchase orders
The Trustee may reject a purchase order or a Creation Basket Deposit if such order or Creation Basket Deposit is not presented in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order, in the opinion of counsel, might be unlawful. None of the Trustee, the Sponsor or the Custodian will be liable for the rejection of any purchase order or Creation Basket Deposit.
Redemption Procedures
The procedures by which an Authorized Participant can redeem one or more Baskets will mirror the procedures for the creation of Baskets. On any business day, an Authorized Participant may place an order with the Trustee to redeem one or more Baskets.
Redemption orders must be placed no later than 3:59:59 p.m. on each business day the NYSE Arca is open for regular trading. In the event of a level 3 market-wide circuit breaker resulting in a trading halt for the remainder of the trading day, the time of the market-wide trading halt is considered the close of regular trading and no redemption orders for the current trade date will be accepted after that time (the “cutoff”). Orders placed after the cutoff will be deemed to be rejected and will not be processed. Orders should be placed in proper form on the following business day. A redemption order so received is effective on the date it is received in satisfactory form by the Trustee. The redemption procedures allow Authorized Participants to redeem Baskets and do not entitle an individual Shareholder to redeem any Shares in an amount less than a Basket, or to redeem Baskets other than through an Authorized Participant.
By placing a redemption order, an Authorized Participant agrees to deliver the Baskets to be redeemed through DTC’s book-entry system to the Trust by the prescribed settlement date. Prior to the delivery of the redemption distribution for a redemption order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the redemption order.
Determination of redemption distribution
The redemption distribution from the Trust consists of a credit to the redeeming Authorized Participant’s Authorized Participant Unallocated Account, representing the amount of the Bullion (in specified proportion of gold, silver, platinum and palladium) held by the Trust evidenced by the Shares being redeemed. Fractions of a fine ounce of Bullion included in the redemption distribution smaller than 0.001 of a fine ounce are disregarded. Redemption distributions will be subject to the deduction of any applicable tax or other governmental charges which may be due.
24
Delivery of redemption distribution
The redemption distribution due from the Trust will be delivered to the Authorized Participant on the prescribed settlement date following a loco London redemption order date if, by 10:00 a.m. New York time on the settlement date, the Trustee’s DTC account has been credited with the Baskets to be redeemed. If a loco swap or physical transfer is necessary to effect a loco London redemption, the redemption distribution due from the Trust will be delivered to the Authorized Participant on or before the prescribed settlement date if, by 10:00 a.m. New York time on the prescribed settlement date, the Trustee’s DTC account has been credited with the Baskets to be redeemed. In the event that, by 10:00 a.m. New York time on the prescribed settlement date, the Trustee’s DTC account has not been credited with the total number of Shares corresponding to the total number of Baskets to be redeemed pursuant to such redemption order, the Trustee shall send to the Authorized Participant and the Custodian via fax or electronic mail message notice of such fact and the Authorized Participant shall have one business day following receipt of such notice to correct such failure. If such failure is not cured within such one business day period, the Trustee (in consultation with the Sponsor) will cancel such redemption order and will send via fax or electronic mail message notice of such cancellation to the Authorized Participant and the Custodian, and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Trustee or the Custodian related to the cancelled order. The Trustee is also authorized to deliver the redemption distribution notwithstanding that the Baskets to be redeemed are not credited to the Trustee’s DTC account by 10:00 a.m. New York time on the prescribed settlement date if the Authorized Participant has collateralized its obligation to deliver the Baskets through DTC’s book entry system on such terms as the Sponsor and the Trustee may from time to time agree upon.
The Custodian transfers the redemption Bullion amount from the Trust Allocated Account to the Trust Unallocated Account and, thereafter, to the redeeming Authorized Participant’s Authorized Participant Unallocated Account. The Authorized Participant and the Trust are each at risk in respect of Bullion credited to their respective unallocated accounts in the event of the Custodian’s insolvency. See “Risk Factors-Bullion held in the Trust’s unallocated Bullion account and any Authorized Participant’s unallocated Bullion account is not segregated from the Custodian’s assets.”
As with the allocation of Bullion to the Trust Allocated Account which occurs upon a purchase order, if in transferring Bullion from the Trust Allocated Account to the Trust Unallocated Account in connection with a redemption order there is an excess amount of Bullion transferred to the Trust Unallocated Account, the excess over the Bullion redemption amount will be held in the Trust Unallocated Account. The Custodian uses commercially reasonable efforts to minimize the amount of Bullion held in the Trust Unallocated Account; no more than 430 ounces of gold (maximum weight to make one London Good Delivery Bar), no more than 1,100 ounces of silver (maximum weight to make one Silver Good Delivery Bar), no more than 192.904 ounces of platinum (maximum weight to make one Good Delivery Platinum Plate or Ingot) and no more than 192 ounces of palladium (maximum weight to make one Good Delivery Palladium Plate or Ingot) is expected to be held in the Trust Unallocated Account at the close of each business day.
Suspension or rejection of redemption orders
The Trustee may, in its discretion, and will when directed by the Sponsor, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the NYSE Arca is closed other than customary weekend or holiday closings, or trading on the NYSE Arca is suspended or restricted or (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of Bullion is not reasonably practicable. None of the Sponsor, the Trustee or the Custodian are liable to any person or in any way for any loss or damages that may result from any such suspension or postponement.
The Trustee will reject a redemption order if the order is not in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful.
Creation and Redemption Transaction Fee
To compensate the Trustee for services in processing the creation and redemption of Baskets, an Authorized Participant is required to pay a transaction fee to the Trustee of $500 per order to create or redeem Baskets. An order may include multiple Baskets. The transaction fee may be reduced, increased or otherwise changed by the Trustee with the consent of the Sponsor. From time to time, the Trustee, with the consent of the Sponsor, may waive all or a portion of the applicable transaction fee. The Trustee shall notify DTC of any agreement to change the transaction fee and will not implement any increase in the fee for the redemption of Baskets until 30 days after the date of the notice.
25
The Sponsor
The Trust’s Sponsor is abrdn ETFs Sponsor LLC, a Delaware limited liability company formed on June 17, 2009.
The Sponsor’s office is located at c/o abrdn ETFs Sponsor LLC, 1900 Market Street, Suite 200, Philadelphia, PA 19103. Prior to April 27, 2018, the Sponsor was wholly-owned by ETF Securities Limited, a Jersey, Channel Islands based company. Effective April 27, 2018, ETF Securities Limited sold its membership interest in the Sponsor to abrdn Inc. (known as Aberdeen Standard Investments Inc. prior to January 1, 2022), a Delaware corporation. As a result of the sale, abrdn Inc. became the sole member of the Sponsor. abrdn Inc. is a wholly-owned indirect subsidiary of Aberdeen Group plc. (“Aberdeen”). Aberdeen has retained “abrdn” as an operational abbreviation across its subsidiary legal entities (including the Sponsor, fund names and descriptors). Under the Delaware Limited Liability Company Act and the governing documents of the Sponsor, the sole member of the Sponsor, abrdn Inc., is not responsible for the debts, obligations and liabilities of the Sponsor solely by reason of being the sole member of the Sponsor.
The Sponsor’s Role
The Sponsor arranged for the creation of the Trust, the ongoing registration of the Shares for their public offering in the United States and the listing of the Shares on the NYSE Arca. The Sponsor has agreed to assume the organizational expenses of the Trust and the following administrative and marketing expenses incurred by the Trust: the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and the reimbursement of the Custodian’s expenses under the Custody Agreements, exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses. The Sponsor also paid the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.
The Sponsor does not exercise day-to-day oversight over the Trustee or the Custodian. The Sponsor may remove the Trustee and appoint a successor Trustee (i) if the Trustee ceases to meet certain objective requirements (including the requirement that it have capital, surplus and undivided profits of at least $150 million), (ii) if, having received written notice of a material breach of its obligations under the Trust Agreement, the Trustee has not cured the breach within 30 days, or (iii) if the Trustee refuses to consent to the implementation of an amendment to the Trust’s initial Internal Control Over Financial Reporting. The Sponsor also has the right to replace the Trustee during the 90 days following any merger, consolidation or conversion in which the Trustee is not the surviving entity or, in its discretion, on the fifth anniversary of the creation of the Trust or on any subsequent third anniversary thereafter. The Sponsor also has the right to approve any new or additional custodian that the Trustee may wish to appoint and any new or additional sub-custodian that the Custodian may wish to appoint.
The Sponsor or one of its affiliates or agents (1) develops a marketing plan for the Trust on an ongoing basis, (2) prepares marketing materials regarding the Shares, including the content of the Trust’s website and (3) executes the marketing plan for the Trust.
The Trustee
The Bank of New York Mellon, a banking corporation organized under the laws of the State of New York with trust powers (“BNYM”), serves as the Trustee. BNYM has a trust office at 240 Greenwich Street, New York, NY 10286. BNYM is subject to supervision by the New York State Financial Services Department and the Board of Governors of the Federal Reserve System. Information regarding creation and redemption Basket composition, NAV of the Trust, transaction fees and the names of the parties that have each executed an Authorized Participant Agreement may be obtained from BNYM. A copy of the Trust Agreement is available for inspection at BNYM’s trust office identified above. Under the Trust Agreement, the Trustee is required to have capital, surplus and undivided profits of at least $150 million.
The Trustee’s Role
The Trustee is generally responsible for the day-to-day administration of the Trust, including keeping the Trust’s operational records. The Trustee’s principal responsibilities include (1) transferring the Trust’s Bullion as needed to pay the Sponsor’s Fee in Bullion (Bullion transfers are expected to occur approximately monthly in the ordinary course), (2) valuing the Trust’s Bullion and calculating the NAV of the Trust and the NAV per Share, (3) receiving and processing orders from Authorized Participants to create and redeem Baskets and coordinating the processing of such orders with the Custodian and DTC, (4) selling the Trust’s Bullion as needed to pay any extraordinary Trust expenses that are not assumed by the Sponsor, (5) when appropriate, making distributions of cash or other property to Shareholders, and (6) receiving and reviewing reports from or on the Custodian’s custody of and transactions in the Trust’s Bullion. The Trustee shall, with respect to directing the Custodian, act in accordance with the instructions of the Sponsor. If the Custodian resigns, the Trustee shall appoint an additional or replacement Custodian selected by the Sponsor.
The Trustee intends to regularly communicate with the Sponsor to monitor the overall performance of the Trust. The Trustee does not monitor the performance of the Custodian or any other sub-custodian other than to review the reports provided by the Custodian pursuant to the Custody Agreements. The Trustee, along with the Sponsor, will liaise with the Trust’s legal, accounting and other professional service providers as needed. The Trustee will assist and support the Sponsor with the preparation of all periodic reports required to be filed with the SEC on behalf of the Trust.
26
The Trustee’s monthly fees and out-of-pocket expenses are paid by the Sponsor.
Affiliates of the Trustee may from time to time act as Authorized Participants or purchase or sell gold, silver, platinum and palladium or Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion. Affiliates of the Trustee are subject to the same transaction fee as other Authorized Participants.
The Custodian
Effective May 23, 2024, the Trustee, at the direction of the Sponsor, entered into an Allocated Account Agreement and Unallocated Account Agreement with ICBC Standard Bank Plc (“ICBC”), providing for the custody of the Trust’s Bullion. Effective August 8, 2024, JPMorgan Chase Bank N.A. no longer serves as a custodian of the Trust’s Bullion.
ICBC is a public limited company incorporated under the laws of England and Wales, serves as a Custodian of the Trust’s Bullion. ICBC’s office is located at 20 Gresham Street, London, EC2V 7JE, United Kingdom.
The Custodian’s Role
The Custodian is responsible for the safekeeping of the Trust’s Bullion deposited with it by Authorized Participants in connection with the creation of Baskets. The Custodian is also responsible for selecting sub-custodians, if any. The Custodian facilitates the transfer of Bullion in and out of the Trust through the unallocated Bullion accounts it will maintain for each Authorized Participant and the unallocated and allocated Bullion accounts it maintains for the Trust. The Custodian holds at its London, England vault premises that portion of the Trust’s allocated Bullion to be held in London. The Custodian is responsible for allocating specific bars of physical gold and silver and specific plates or ingots of physical platinum and palladium to the Trust’s allocated Bullion account. The Custodian provides the Trustee with regular reports detailing the Bullion transfers in and out of the Trust’s unallocated and allocated Bullion accounts and identifying the gold and silver bars and the platinum and palladium plates or ingots held in the Trust’s allocated Bullion account.
The Custodian’s fees and expenses under the Custody Agreements are paid by the Sponsor.
The Custodian and its affiliates may from time to time act as Authorized Participants or purchase or sell Bullion or Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion. The Custodian and its affiliates are subject to the same transaction fee as other Authorized Participants.
Inspection of Bullion
Under the Custody Agreements, the Trustee, the Sponsor and the Trust’s auditors and inspectors may, only up to twice a year, visit the premises of the Custodian for the purpose of examining the Trust’s Bullion and certain related records maintained by the Custodian. In addition, under the Custody Agreements, the Custodian shall procure that any sub-custodian that it appoints allows access to its premises during normal business hours to examine the Trust’s Bullion held there and such records as the Trustee, the Sponsor or the Trust’s auditors and inspectors may reasonably require to perform their respective duties to Shareholders.
The Sponsor has exercised its right to visit the Custodian in order to examine the Bullion and the records maintained by the Custodian. Inspections were conducted by Bureau Veritas Commodities UK Ltd, a leading commodity inspection and testing company retained by the Sponsor, as of August 4, 2025 and January 5, 2026.
There can be no guarantee that the Sponsor or the Trust’s auditors and inspectors will be able to perform physical inspections of the Trust’s Bullion as planned. Local policies, regulations, or ordinances, as well as polices or restrictions adopted by the Custodian or a sub-custodian, may temporarily prevent, or otherwise impair the ability of, the Sponsor or the Trust’s auditors and inspectors, from performing a physical inspection of the Trust’s Bullion on a desired date. In those situations, the Sponsor or the Trust’s auditors and inspectors may seek to verify the Bullion held by the Trust by alternate means, including through virtual inspections of the Trust’s Bullion and/or a review of pertinent records.
Description of the Shares
General
The Trustee is authorized under the Trust Agreement to create and issue an unlimited number of Shares. The Trustee creates Shares only in Baskets (a Basket equals a block of 25,000 Shares) and only upon the order of an Authorized Participant. The Shares represent units of fractional undivided beneficial interest in and ownership of the Trust and have no par value. Any creation and issuance of Shares above the amount registered on the Trust’s then-current and effective registration statement with the SEC will require the registration of such additional Shares.
27
Description of Limited Rights
The Shares do not represent a traditional investment and Shareholders should not view them as similar to shares of a corporation operating a business enterprise with management and a board of directors. Shareholders do not have the statutory rights normally associated with the ownership of shares of a corporation, including, for example, the right to bring “oppression” or “derivative” actions. All Shares are of the same class with equal rights and privileges. Each Share is transferable, is fully paid and non-assessable and entitles the holder to vote on the limited matters upon which Shareholders may vote under the Trust Agreement. The Shares do not entitle their holders to any conversion or pre-emptive rights, or, except as provided below, any redemption rights or rights to distributions.
Distributions
If the Trust is terminated and liquidated, the Trustee will distribute to the Shareholders any amounts remaining after the satisfaction of all outstanding liabilities of the Trust and the establishment of such reserves for applicable taxes, other governmental charges and contingent or future liabilities as the Trustee shall determine. Shareholders of record on the record date fixed by the Trustee for a distribution will be entitled to receive their pro rata portion of any distribution.
Voting and Approvals
Under the Trust Agreement, Shareholders have no voting rights, except in limited circumstances. The Trustee may terminate the Trust upon the agreement of Shareholders owning at least 75% of the outstanding Shares. In addition, certain amendments to the Trust Agreement require advance notice to the Shareholders before the effectiveness of such amendments, but no Shareholder vote or approval is required for any amendment to the Trust Agreement.
Redemption of the Shares
The Shares may only be redeemed by or through an Authorized Participant and only in Baskets.
Book-Entry Form
Individual certificates will not be issued for the Shares. Instead, one or more global certificates is deposited by the Trustee with DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates evidence all of the Shares outstanding at any time. Under the Trust Agreement, Shareholders are limited to (1) participants in DTC such as banks, brokers, dealers and trust companies (DTC Participants), (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant (Indirect Participants), and (3) those banks, brokers, dealers, trust companies and others who hold interests in the Shares through DTC Participants or Indirect Participants. The Shares are only transferable through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers will be made in accordance with standard securities industry practice.
Custody of the Trust’s Bullion
Custody of the physical gold and silver deposited with and held by the Trust is provided by the Custodian at its London, England vaults and by other sub-custodians on a temporary basis. Custody of the physical platinum and palladium deposited with and held by the Trust is provided by the Custodian at its London, England vaults and by other sub-custodians on a temporary basis. The Custodian is a market maker, clearer and approved weigher under the rules of the LBMA and the LPPM.
The Custodian is the custodian of the physical Bullion credited to the Trust Allocated Account in accordance with the Custody Agreements. The Custodian segregates the physical Bullion credited to the Trust Allocated Account from any other precious metal it holds or holds for others by entering appropriate entries in its books and records, Under the Custody Agreements, the Trustee, the Sponsor and the Trust’s auditors and inspectors may inspect the vaults of the Custodian. See “Inspection of Bullion”.
The Custodian, as instructed by the Trustee on behalf of the Trust, is authorized to accept, on behalf of the Trust, deposits of Bullion in unallocated form. Acting on standing instructions specified in the Custody Agreements, the Custodian allocates, Bullion deposited in unallocated form with the Trust by selecting bars of gold or silver or plates or ingots of platinum or palladium for deposit to the Trust Allocated Account. All physical gold and silver allocated to the Trust must conform to the rules, regulations, practices and customs of the LBMA. All physical platinum and palladium allocated to the Trust must conform to the rules, regulations, practices and customs of the LPPM. The Custodian must replace any non-conforming Bullion with conforming Bullion as soon as practical upon a determination by the Custodian any Bullion is non-conforming.
28
The process of withdrawing Bullion from the Trust for a redemption of a Basket follows the same general procedure as for depositing Bullion with the Trust for a creation of a Basket, only in reverse. Each transfer of Bullion between the Trust Allocated Account and the Trust Unallocated Account connected with a creation or redemption of a Basket may result in a small amount of Bullion being held in the Trust Unallocated Account after the completion of the transfer. In making deposits and withdrawals between the Trust Allocated Account and the Trust Unallocated Account, the Custodian will use commercially reasonable efforts to minimize the amounts of gold, silver, platinum and palladium held in the Trust Unallocated Account as of the close of each business day. See "Creation and Redemption of Shares.”
United States Federal Income Tax Consequences
The following discussion of the material US federal income tax consequences generally applies to the purchase, ownership and disposition of Shares by a US Shareholder (as defined below) and certain US federal income tax consequences that may apply to an investment in Shares by a Non-US Shareholder (as defined below). The discussion is based on the United States Internal Revenue Code of 1986 as amended (the “Code”). The discussion below is based on the Code, United States Treasury Regulations (“Treasury Regulations”) promulgated under the Code and judicial and administrative interpretations of the Code, all as in effect on the date of this annual report and all of which are subject to change either prospectively or retroactively. The tax treatment of Shareholders may vary depending upon their own particular circumstances. Certain Shareholders (including broker-dealers, traders, banks and other financial institutions, insurance companies, real estate investment trusts, tax-exempt entities, Shareholders whose functional currency is not the U.S. Dollar or other investors with special circumstances) may be subject to special rules not discussed below. In addition, the following discussion applies only to investors who hold Shares as “capital assets” within the meaning of Code section 1221 and not as part of a straddle, hedging transaction or a conversion or constructive sale transaction. Moreover, the discussion below does not address the effect of any state, local or foreign tax law or any transfer tax on an owner of Shares. Purchasers of Shares are urged to consult their own tax advisors with respect to all federal, state, local and foreign tax law or any transfer tax considerations potentially applicable to their investment in Shares.
For purposes of this discussion, a “US Shareholder” is a Shareholder that is:
| ● | An individual who is a citizen or resident of the United States; |
| ● | A corporation (or other entity treated as a corporation for US federal tax purposes) created or organized in or under the laws of the United States or any political subdivision thereof; |
| ● | An estate, the income of which is includible in gross income for US federal income tax purposes regardless of its source; or |
| ● | A trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more US persons have the authority to control all substantial decisions of the trust. |
Taxation of the Trust
The Trust is classified as a “grantor trust” for US federal income tax purposes. As a result, the Trust itself is not subject to US federal income tax. Instead, the Trust’s income and expenses “flow through” to the Shareholders, and the Trustee reports the Trust’s income, gains, losses and deductions to the Internal Revenue Service (“IRS”) on that basis.
A Shareholder that is not a US Shareholder as defined above (other than a partnership, or an entity treated as a partnership for US federal tax purposes) generally is considered a “Non-US Shareholder” for purposes of this discussion. For US federal income tax purposes, the treatment of any beneficial owner of an interest in a partnership, including any entity treated as a partnership for US federal income tax purposes, generally depends upon the status of the partner and upon the activities of the partnership. Partnerships and partners in partnerships should consult their tax advisors about the US federal income tax consequences of purchasing, owning and disposing of Shares.
Taxation of US Shareholders
Shareholders generally are treated, for US federal income tax purposes, as if they directly owned a pro rata share of the underlying assets held by the Trust. Shareholders are also treated as if they directly received their respective pro rata share of the Trust’s income, if any, and as if they directly incurred their respective pro rata share of the Trust’s expenses. In the case of a Shareholder that purchases Shares for cash, its initial tax basis in its pro rata share of the assets held in the Trust at the time it acquires its Shares is equal to its cost of acquiring the Shares. In the case of a Shareholder that acquires its Shares as part of a creation of a Basket, the delivery of Bullion to the Trust in exchange for the Shares is not a taxable event to the Shareholder, and the Shareholder’s tax basis and holding period for the Shares are the same as its tax basis and holding period for the Bullion delivered in exchange therefore (except to the extent of any cash contributed for such Shares). For purposes of this discussion, it is assumed that all of a Shareholder’s Shares are acquired on the same date and at the same price per Share. Shareholders that hold multiple lots of Shares, or that are contemplating acquiring multiple lots of Shares, should consult their tax advisors.
29
When the Trust sells or transfers precious metal, for example to pay expenses, a Shareholder generally will recognize gain or loss in an amount equal to the difference between (1) the Shareholder’s pro rata share of the amount realized by the Trust upon the sale or transfer and (2) the Shareholder’s tax basis for its pro rata share of the precious metal that was sold or transferred. Such gain or loss will generally be long-term or short-term capital gain or loss, depending upon whether the Shareholder has a holding period in its Shares of longer than one year. A Shareholder’s tax basis for its share of any precious metal sold by the Trust generally will be determined by multiplying the Shareholder’s total basis for its Shares immediately prior to the sale, by a fraction the numerator of which is the amount of precious metal sold, and the denominator of which is the total amount of the precious metal held by the Trust immediately prior to the sale. After any such sale, a Shareholder’s tax basis for its pro rata share of the Bullion remaining in the Trust will be equal to its tax basis for its Shares immediately prior to the sale, less the portion of such basis allocable to its share of the precious metal that was sold.
Upon a Shareholder’s sale of some or all of its Shares, the Shareholder will be treated as having sold a pro rata share of the precious metal held in the Trust at the time of the sale. Accordingly, the Shareholder generally will recognize a gain or loss on the sale in an amount equal to the difference between (1) the amount realized pursuant to the sale of the Shares, and (2) the Shareholder’s tax basis for the Shares sold, as determined in the manner described in the preceding paragraph.
A redemption of some or all of a Shareholder’s Shares in exchange for the underlying precious metal represented by the Shares redeemed generally will not be a taxable event to the Shareholder. The Shareholder’s tax basis for the precious metal received in the redemption generally will be the same as the Shareholder’s tax basis for the Shares redeemed. The Shareholder’s holding period with respect to the Bullion received should include the period during which the Shareholder held the Shares redeemed. A subsequent sale of the precious metal received by the Shareholder will be a taxable event.
An Authorized Participant and other investors may be able to re-invest, on a tax-deferred basis, in-kind redemption proceeds received from exchange-traded products that are substantially similar to the Trust in the Trust’s Shares. Authorized Participants and other investors should consult their tax advisors as to whether and under what circumstances the reinvestment in the Shares of proceeds from substantially similar exchange-traded products can be accomplished on a tax-deferred basis.
Under current law, gains recognized by individuals, estates or trusts from the sale of “collectibles,” including physical Bullion, held for more than one year are taxed at a maximum federal income tax rate of 28%, rather than the 20% rate applicable to most other long-term capital gains. For these purposes, gains recognized by an individual upon the sale of Shares held for more than one year, or attributable to the Trust’s sale of any physical Bullion which the Shareholder is treated (through its ownership of Shares) as having held for more than one year, generally will be taxed at a maximum rate of 28%. The tax rates for capital gains recognized upon the sale of assets held by an individual US Shareholder for one year or less or by a corporate taxpayer are generally the same as those at which ordinary income is taxed.
In addition, high-income individuals and certain trusts and estates are subject to a 3.8% Medicare contribution tax that is imposed on net investment income and gain. Shareholders should consult their tax advisor regarding this tax.
Brokerage Fees and Trust Expenses
Any brokerage or other transaction fees incurred by a Shareholder in purchasing Shares is treated as part of the Shareholder’s tax basis in the Shares. Similarly, any brokerage fee incurred by a Shareholder in selling Shares reduces the amount realized by the Shareholder with respect to the sale.
Shareholders will be required to recognize a gain or loss upon a sale of Bullion by the Trust (as discussed above), even though some or all of the proceeds of such sale are used by the Trustee to pay Trust expenses. Shareholders may deduct their respective pro rata share of each expense incurred by the Trust to the same extent as if they directly incurred the expense. Shareholders who are individuals, estates or trusts, however, may be required to treat some or all of the expenses of the Trust, to the extent that such expenses may be deducted, as miscellaneous itemized deductions. Miscellaneous itemized deductions, including expenses for the production of income, will not be deductible for either regular federal income tax or alternative minimum tax purposes for taxable years beginning after December 31, 2017 and before January 1, 2026 and thereafter generally are (i) deductible only to the extent that the aggregate of a Shareholder’s miscellaneous itemized deductions exceeds 2% of such Shareholder’s adjusted gross income for federal income tax purposes, (ii) not deductible for the purposes of the alternative minimum tax and (iii) are subject to the overall limitation on itemized deductions under the Code.
Investment by Regulated Investment Companies
Mutual funds and other investment vehicles which are “regulated investment companies” within the meaning of Code section 851 should consult with their tax advisors concerning (1) the likelihood that an investment in Shares, although they are a “security” within the meaning of the Investment Company Act of 1940, may be considered an investment in the underlying Bullion for purposes of Code section 851(b), and (2) the extent to which an investment in Shares might nevertheless be consistent with preservation of their qualification under Code section 851. In administrative guidance, the IRS stated that it will no longer issue rulings under Code section 851(b) relating to the determination of whether or not an instrument or position is a “security”, but, instead, intends to defer to guidance from the SEC for such determination.
30
United States Information Reporting and Backup Withholding Tax for US and Non-US Shareholders
The Trustee or the appropriate broker will file certain information returns with the IRS, and provides certain tax-related information to Shareholders, in accordance with applicable Treasury Regulations. Each Shareholder will be provided with information regarding its allocable portion of the Trust’s annual income (if any) and expenses.
A US Shareholder may be subject to US backup withholding tax in certain circumstances unless it provides its taxpayer identification number and complies with certain certification procedures. Non-US Shareholders may have to comply with certification procedures to establish that they are not a US person in order to avoid the backup withholding tax.
The amount of any backup withholding tax will be allowed as a credit against a Shareholder’s US federal income tax liability and may entitle such a Shareholder to a refund, provided that the required information is furnished to the IRS.
Income Taxation of Non-US Shareholders
The Trust does not expect to generate taxable income except for gains (if any) upon the sale of precious metal. A Non-US Shareholder generally is not subject to US federal income tax with respect to gains recognized upon the sale or other disposition of Shares, or upon the sale of precious metal by the Trust, unless (1) the Non-US Shareholder is an individual and is present in the United States for 183 days or more during the taxable year of the sale or other disposition, and the gain is treated as being from United States sources; or (2) the gain is effectively connected with the conduct by the Non-US Shareholder of a trade or business in the United States.
Taxation in Jurisdictions other than the United States
Prospective purchasers of Shares that are based in or acting out of a jurisdiction other than the United States are advised to consult their own tax advisers as to the tax consequences, under the laws of such jurisdiction (or any other jurisdiction not being the United States to which they are subject), of their purchase, holding, sale and redemption of or any other dealing in Shares and, in particular, as to whether any value added tax, other consumption tax or transfer tax is payable in relation to such purchase, holding, sale, redemption or other dealing.
ERISA and Related Considerations
The Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and/or Code section 4975 impose certain requirements on certain employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans, and certain commingled investment vehicles or insurance company general or separate accounts in which such plans or arrangements are invested (collectively, “Plans”), and on persons who are fiduciaries with respect to the investment of “plan assets” of a Plan. Government plans and some church plans are not subject to the fiduciary responsibility provisions of ERISA or the provisions of section 4975 of the Code, but may be subject to substantially similar rules under other federal law, or under state or local law (“Other Law”).
In contemplating an investment of a portion of Plan assets in Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan and the “Risk Factors” discussed above and whether such investment is consistent with its fiduciary responsibilities under ERISA or Other Law, including, but not limited to: (1) whether the investment is permitted under the Plan’s governing documents, (2) whether the fiduciary has the authority to make the investment, (3) whether the investment is consistent with the Plan’s funding objectives, (4) the tax effects of the investment on the Plan, and (5) whether the investment is prudent considering the factors discussed in this report. In addition, ERISA and Code section 4975 prohibit a broad range of transactions involving assets of a plan and persons who are “parties in interest” under ERISA or “disqualified persons” under section 4975 of the Code. A violation of these rules may result in the imposition of significant excise taxes and other liabilities. Plans subject to Other Law may be subject to similar restrictions.
It is anticipated that the Shares will constitute “publicly offered securities” as defined in the Department of Labor “Plan Asset Regulations,” §2510.3-101 (b)(2) as modified by section 3(42) of ERISA. Accordingly, pursuant to the Plan Asset Regulations, only Shares purchased by a Plan, and not an interest in the underlying assets held in the Trust, should be treated as assets of the Plan, for purposes of applying the “fiduciary responsibility” rules of ERISA and the “prohibited transaction” rules of ERISA and the Code. Fiduciaries of plans subject to Other Law should consult legal counsel to determine whether there would be a similar result under the Other Law.
31
Investment by Certain Retirement Plans
Code section 408(m) provides that the acquisition of a “collectible” by an individual retirement account (“IRA”) or a participant-directed account maintained under any plan that is tax-qualified under Code section 401(a) (“Tax Qualified Account”) is treated as a taxable distribution from the account to the owner of the IRA, or to the participant for whom the Tax Qualified Account is maintained, of an amount equal to the cost to the account of acquiring the collectible. The term “collectible” is defined to include, with certain exceptions, “any metal or gem”. The IRS has issued several private letter rulings to the effect that a purchase by an IRA, or by a participant-directed account under a Code section 401(a) plan, of publicly-traded shares in a trust holding precious metals will not be treated as resulting in a taxable distribution to the IRA owner or Tax Qualified Account participant under Code section 408(m). However the private letter rulings provide that, if any of the Shares so purchased are distributed from the IRA or Tax Qualified Account to the IRA owner or Tax Qualified Account participant, or if any precious metals are received by such IRA or Tax Qualified Account upon the redemption of any of the Shares purchased by it, the Shares or precious metal so distributed will be subject to federal income tax in the year of distribution, to the extent provided under the applicable provisions of Code sections 408(d), 408(m) or 402. Accordingly, potential IRA or Tax Qualified Account investors are urged to consult with their own professional advisors concerning the treatment of an investment in Shares under Code section 408(m).
Item 1A. Risk Factors
Shareholders should consider carefully the risks described below before making an investment decision. Shareholders should also refer to the other information included in this report, including the Trust’s financial statements and the related notes.
RISKS RELATED TO BULLION
The value of the Shares relates directly to the value of the Bullion held by the Trust and fluctuations in the price of gold, silver, platinum or palladium could materially adversely affect an investment in the Shares.
The Shares are designed to mirror as closely as possible the performance of the price of physical gold, silver, platinum and palladium in the proportions held by the Trust, and the value of the Shares relates directly to the value of the Bullion held by the Trust, less the Trust’s liabilities (including estimated accrued but unpaid expenses). The prices of physical gold, silver, platinum and palladium have fluctuated widely over the past several years, as discussed below. Several factors may affect the price of these metals, including:
| ● | A change in economic conditions, such as a recession, can adversely affect the price of Bullion. Bullion is 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; |
| ● | Global or regional political, economic or financial events and situations; and |
| ● | Global Bullion supply and demand. |
| ● | A significant change in investor interest, including in response to online campaigns or other activities specifically targeting investments in Bullion. |
In addition, investors should be aware that there is no assurance that gold, silver, platinum or palladium will maintain their long-term value in terms of purchasing power in the future. In the event that the price of any metal held by the Trust declines, the Sponsor expects the value of an investment in the Shares to be impacted proportionately to the Trust’s interest in such metal.
The price of physical Bullion has fluctuated widely over the past several years.
The price of physical Bullion, and the value of the Shares, has been highly volatile and could continue to be subject to wide fluctuations in response to various factors. See “Overview of the Bullion Industry” for discussion of the fluctuation of Bullion prices.
Several factors may have the effect of causing a decline in the prices of Bullion and a corresponding decline in the price of Shares. Among them:
| ● | A significant increase in Bullion hedging activity by Bullion producers. Should there be an increase in the level of hedge activity of Bullion producing companies, it could cause a decline in world Bullion prices, adversely affecting the price of the Shares. |
| ● | A significant change in the attitude of speculators and investors towards Bullion. Should the speculative community take a negative view towards any Bullion metals, it could cause a decline in world prices for such Bullion metals, negatively impacting the price of the Shares. |
32
| ● | A widening of interest rate differentials between the cost of money and the cost of Bullion could negatively affect the price of Bullion which, in turn, could negatively affect the price of the Shares. |
| ● | A combination of rising money interest rates and a continuation of the current low cost of borrowing Bullion could improve the economics of selling Bullion forward. This could result in an increase in hedging by Bullion mining companies and short selling by speculative interests, which would negatively affect the price of Bullion. Under such circumstances, the price of the Shares would be similarly affected. |
Conversely, several factors may trigger a temporary increase in the price of Bullion prior to your investment in the Shares. If that is the case, you will be buying Shares at prices affected by the temporarily high prices of Bullion, and you may incur losses when the causes for the temporary increase disappear.
A decline in the automobile industry may have the effect of causing a decline in the prices of platinum and palladium and a corresponding decline in the price of Shares.
Autocatalysts, automobile components for emissions control that use platinum and palladium, accounted for approximately 44% of the net global demand in platinum and 84% of the global demand in palladium in 2023. Reduced automotive industry sales may result in a decline in autocatalyst demand which may impact the price of platinum and palladium and affect the price of the Shares.
Crises may motivate large-scale sales of gold, silver, platinum or palladium which could decrease the price of such Bullion and adversely affect an investment in the Shares.
The possibility of large-scale distress sales of Bullion in times of crisis may have a short-term negative impact on the price of Bullion and adversely affect an investment in the Shares. For example, the 2008 financial credit crisis resulted in significantly depressed prices of gold, silver, platinum and palladium largely due to forced sales and deleveraging from institutional investors. Crises in the future may impair Bullion’s price performance which would, in turn, adversely affect an investment in the Shares.
The price of Bullion may be affected by the sale of ETVs tracking the gold, silver, platinum or palladium markets.
To the extent existing exchange traded vehicles (“ETVs”) tracking the gold, silver, platinum or palladium markets represent a significant proportion of demand for physical Bullion, large redemptions of the securities of these ETVs could negatively affect physical Bullion prices and the price and NAV of the Shares.
RISKS RELATED TO THE SHARES
The Shares and their value could decrease if unanticipated operational or trading problems arise.
There may be unanticipated problems or issues with respect to the mechanics of the Trust’s operations and the trading of the Shares that could have a material adverse effect on an investment in the Shares. In addition, although the Trust is not actively “managed” by traditional methods, to the extent that unanticipated operational or trading problems or issues arise, the Sponsor’s past experience and qualifications may not be suitable for solving these problems or issues.
Discrepancies, disruptions or unreliability of the LBMA Gold Price PM, the LBMA Silver Price, or the LBMA Price PM could impact the value of the Trust’s Bullion and the market price of the Shares.
The Trustee values the Trust’s gold, silver, platinum and palladium pursuant to the LBMA Gold Price PM for gold, the LBMA Silver Price for silver, and the LBMA Price PM for platinum and palladium. In the event that the LBMA Gold Price PM, the LBMA Silver Price, or the LBMA Price PM (the “London Metal Prices”) prove to be inaccurate benchmarks, or such London Metal Prices vary materially from the prices determined by other mechanisms for valuing precious metals, the value of the Trust’s Bullion and the market price of the Shares could be adversely impacted. Any future developments in the London Metal Prices, to the extent they have a material impact on the London Metal Prices, could adversely impact the value of the Trust’s Bullion and the market price of the Shares. It is possible that electronic failures or other unanticipated events may occur that could result in delays in the announcement of, or the inability of the benchmarks to produce, the London Metal Prices on any given date. Furthermore, any actual or perceived disruptions that result in the perception that the London Metal Prices are vulnerable to actual or attempted manipulation could adversely affect the behavior of market participants, which may have an effect on the prices of gold, silver, platinum or palladium. If the London Metal Prices are unreliable for any reason, the prices of gold, silver, platinum and palladium and the market price for the Shares may decline or be subject to greater volatility.
If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions intended to keep the price of the Shares closely linked to the prices of the underlying Bullion may not exist and, as a result, the price of the Shares may fall.
If the processes of creation and redemption of Shares (which depend on timely transfers of Bullion to and by the Custodian) encounter any unanticipated difficulties, potential market participants who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the prices of the underlying Bullion may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. If this is the case, the liquidity of Shares may decline and the price of the Shares may fluctuate independently of the prices of the underlying Bullion and may fall. Additionally, redemptions could be suspended in any period during which (1) the NYSE Arca is closed (other than customary weekend or holiday closings) or trading on the NYSE Arca is suspended or restricted, or (2) an emergency exists as a result of which delivery, disposal or evaluation of the Bullion is not reasonably practicable.
33
A possible “short squeeze” due to a sudden increase in demand of Shares that largely exceeds supply may lead to price volatility in the Shares.
Investors may purchase Shares to hedge existing exposure to Bullion or to speculate on the price of Bullion. Speculation on the price of Bullion may involve long and short exposures. To the extent aggregate short exposure exceeds the number of Shares available for purchase (for example, in the event that large redemption requests by Authorized Participants dramatically affect Share liquidity), investors with short exposure may have to pay a premium to repurchase Shares for delivery to Share lenders. Those repurchases may in turn, dramatically increase the price of the Shares until additional Shares are created through the creation process. This is often referred to as a “short squeeze.” A short squeeze could lead to volatile price movements in Shares that are not directly correlated to the price of Bullion.
The liquidity of the Shares may be affected by the withdrawal from participation of one or more Authorized Participants.
In the event that one or more Authorized Participants having substantial interests in Shares or otherwise responsible for a significant portion of the Shares’ daily trading volume on the exchange withdraw from participation, the liquidity of the Shares will likely decrease which could adversely affect the market price of the Shares and result in Shareholders incurring a loss on their investment.
Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act of 1940 or the protections afforded by the CEA.
The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. Consequently, Shareholders do not have the regulatory protections provided to investors in investment companies. The Trust does not and will not hold or trade in commodity futures contracts, “commodity interests” or any other instruments regulated by the CEA, as administered by the CFTC and the NFA. Furthermore, the Trust is not a commodity pool for purposes of the CEA, and neither the Sponsor nor the Trustee is subject to regulation by the CFTC as a commodity pool operator or a commodity trading advisor in connection with the Trust or the Shares. Consequently, Shareholders do not have the regulatory protections provided to investors in CEA-regulated instruments or commodity pools operated by registered commodity pool operators or advised by registered commodity trading advisors.
The Trust may be required to terminate and liquidate at a time that is disadvantageous to Shareholders.
If the Trust is required to terminate and liquidate, such termination and liquidation could occur at a time which is disadvantageous to Shareholders, such as when Bullion prices are lower than the Bullion prices at the time when Shareholders purchased their Shares. In such a case, when the Trust’s Bullion is sold as part of the Trust’s liquidation, the resulting proceeds distributed to Shareholders will be less than if Bullion prices were higher at the time of sale.
The lack of an active trading market for the Shares may result in losses on investment at the time of disposition of the Shares.
Although Shares are listed for trading on the NYSE Arca, it cannot be assumed that an active trading market for the Shares will be maintained. If an investor needs to sell Shares at a time when no active market for Shares exists, such lack of an active market will most likely adversely affect the price the investor receives for the Shares (assuming the investor is able to sell them).
Shareholders do not have the rights enjoyed by investors in certain other vehicles.
As interests in an investment trust, the Shares have none of the statutory rights normally associated with the ownership of shares of a corporation (including, for example, the right to bring “oppression” or “derivative” actions). In addition, the Shares have limited voting and distribution rights (for example, Shareholders do not have the right to elect directors or approve amendments to the Trust Agreement, and do not receive dividends).
An investment in the Shares may be adversely affected by competition from other methods of investing in Bullion.
The Trust competes with other financial vehicles, including traditional debt and equity securities issued by companies in the gold, silver, platinum and palladium industries and other securities backed by or linked to Bullion, direct investments in Bullion and investment vehicles similar to the Trust. Market and financial conditions, and other conditions beyond the Sponsor’s control, may make it more attractive to invest in other financial vehicles or to invest in Bullion directly, which could limit the market for the Shares and reduce the liquidity of the Shares.
34
The amount of Bullion represented by each Share will decrease over the life of the Trust due to the recurring deliveries of Bullion necessary to pay the Sponsor’s Fee in-kind and potential sales of Bullion to pay in cash the Trust expenses not assumed by the Sponsor. Without increases in the prices of gold, silver, platinum and palladium sufficient to compensate for that decrease, the price of the Shares will also decline proportionately over the life of the Trust.
The amount of Bullion represented by each Share decreases each day by the Sponsor’s Fee. In addition, although the Sponsor has agreed to assume all organizational and certain administrative and marketing expenses incurred by the Trust (the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and reimbursement of the Custodian’s expenses under the Custody Agreements, exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses), in exceptional cases certain Trust expenses may need to be paid by the Trust. Because the Trust does not have any income, it must either make payments in-kind by deliveries of Bullion (as is the case with the Sponsor’s Fee) or it must sell Bullion to obtain cash (as in the case of any exceptional expenses). The result of these sales of Bullion and recurring deliveries of Bullion to pay the Sponsor’s Fee in-kind is a decrease in the amount of Bullion represented by each Share. New deposits of Bullion, received in exchange for new Baskets issued by the Trust, will not reverse this trend.
A decrease in the amount of Bullion represented by each Share results in a decrease in each Share’s price even if the prices of gold, silver, platinum and palladium do not change. To retain the Share’s original price, the price of Bullion must increase, whether that is the price of gold, silver, platinum, palladium or any combination thereof. Without that increase, the lesser amount of Bullion represented by the Share will have a correspondingly lower price. If these increases do not occur, or are not sufficient to counter the lesser amount of Bullion represented by each Share, Shareholders will sustain losses on their investment in Shares.
An increase in Trust expenses not assumed by the Sponsor, or the existence of unexpected liabilities affecting the Trust, will require the Trustee to sell larger amounts of Bullion, and will result in a more rapid decrease of the amount of Bullion represented by each Share and a corresponding decrease in its value.
The sale of the Trust’s Bullion to pay expenses not assumed by the Sponsor, or unexpected liabilities affecting the Trust, at a time of low Bullion prices could adversely affect the value of the Shares.
The Trustee sells Bullion held by the Trust to pay Trust expenses not assumed by the Sponsor on an as-needed basis irrespective of then-current gold, silver, platinum and palladium prices. The Trust is not actively managed and no attempt will be made to buy or sell Bullion to protect against or to take advantage of fluctuations in the price of any Bullion metal. Consequently, the Trust’s Bullion may be sold at a time when the Bullion prices are low, resulting in the sale of more Bullion than would be required if the Trust sold when prices were higher. The sale of the Trust’s Bullion to pay expenses not assumed by the Sponsor, or unexpected liabilities affecting the Trust, at a time of low Bullion prices could adversely affect the value of the Shares.
The value of the Shares will be adversely affected if the Trust is required to indemnify the Sponsor or the Trustee under the Trust Agreement.
Under the Trust Agreement, each of the Sponsor and the Trustee has a right to be indemnified from the Trust for any liability or expense it incurs without gross negligence, bad faith, willful misconduct, willful malfeasance or reckless disregard on its part. That means the Sponsor or the Trustee may require the assets of the Trust to be sold in order to cover losses or liability suffered by it. Any sale of that kind would reduce the NAV of the Trust and the value of the Shares.
The Shares may trade at a price which is at, above or below the NAV per Share and any discount or premium in the trading price relative to the NAV per Share may widen as a result of non-concurrent trading hours between the NYSE Arca and London, Zurich and COMEX.
The Shares may trade at, above or below the NAV per Share. The NAV per Share fluctuates with changes in the market value of the Trust’s assets. The trading price of the Shares fluctuates in accordance with changes in the NAV per Share as well as market supply and demand. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by non-concurrent trading hours between the NYSE Arca and the major Bullion markets. While the Shares trade on the NYSE Arca until 4:00 p.m. New York time, liquidity in the market for gold, platinum and palladium is reduced after the close of the major world markets for gold, platinum and palladium, including London, Zurich and the COMEX and liquidity in the market for silver will be reduced after the close of the major world silver markets, including London and the COMEX. As a result, during these periods, trading spreads, and the resulting premium or discount on the Shares, may widen.
Purchasing activity in the platinum and palladium markets associated with Basket creations or selling activity following Basket redemptions may affect the prices of platinum and palladium and Share trading prices. These price changes may adversely affect an investment in the Shares.
Purchasing activity associated with acquiring the Bullion required for deposit into the Trust in connection with the creation of Baskets may increase the market prices of platinum and palladium, which will result in higher prices for the Shares. Increases in the market prices of platinum and palladium may also occur as a result of the purchasing activity of other market participants. Other market participants may attempt to benefit from an increase in the market prices of platinum and palladium that may result from increased purchasing activity of platinum and palladium connected with the issuance of Baskets. If, the prices of platinum and palladium decline, the trading price of the Shares will also decline.
35
Selling activity associated with sales of platinum and palladium withdrawn from the Trust in connection with the redemption of Baskets may decrease the market price of platinum and palladium, which will result in lower prices for the Shares. Decreases in the market price of platinum and palladium may also occur as a result of the selling activity of other market participants. If the price of platinum and palladium declines, the trading price of the Shares will also decline in proportion to the Trust’s interest in platinum and palladium.
Since there is no limit on the amount of platinum and palladium that the Trust may acquire, the Trust, as it grows, may have an impact on the supply and demand of platinum and palladium that ultimately may affect the price of the Shares in a manner unrelated to other factors affecting the global markets for platinum and palladium.
The Trust Agreement places no limit on the amount of platinum and palladium the Trust may hold. Moreover, the Trust may issue an unlimited number of Shares, subject to registration requirements, and thereby acquire an unlimited amount of platinum and palladium. The global market for platinum and palladium is characterized by supply and demand constraints that are generally not present in the markets for other precious metals such as gold and silver. Between 2019 to 2023, world platinum mine supply averaged 5.7 million ounces, while world gross demand averaged 7.3 million ounces. During the same period, world palladium mine supply measured 6.5 million ounces, while world gross demand averaged 10.4 million ounces. If the amount of platinum and palladium acquired by the Trust is large enough in relation to global platinum and palladium supply and demand, further in-kind creations and redemptions of Shares could have an impact on the supply and demand of platinum and palladium unrelated to other factors affecting the global markets for platinum and palladium. Such an impact could affect the prices for platinum and palladium that would directly affect the price at which Shares are traded on the Exchange or the price of future Baskets created or redeemed by the Trust.
The Trust and the Sponsor cannot provide Shareholders any assurance that the metal holdings of the Trust will have a similar impact or have no long-term metal price impact thereby affecting Share trading prices.
RISKS RELATED TO THE CUSTODY OF BULLION
The Trust’s Bullion may be subject to loss, damage, theft or restriction on access.
There is a risk that part or all of the Trust’s Bullion could be lost, damaged or stolen. Access to the Trust’s Bullion could also be restricted by natural events (such as an earthquake) or human actions (such as a terrorist attack). Any of these events may adversely affect the operations of the Trust and, consequently, an investment in the Shares.
The Trust’s lack of insurance protection and the Shareholders’ limited rights of legal recourse against the Trust, the Trustee, the Sponsor, the Custodian and any sub-custodian exposes the Trust and its Shareholders to the risk of loss of the Trust’s Bullion for which no person is liable.
The Trust does not insure its Bullion. The Custodian maintains insurance with regard to its business on such terms and conditions as it considers appropriate in connection with its custodial obligations and is responsible for all costs, fees and expenses arising from the insurance policy or policies. The Trust is not a beneficiary of any such insurance and does not have the ability to dictate the existence, nature or amount of coverage. Therefore, Shareholders cannot be assured that the Custodian maintains adequate insurance or any insurance with respect to the Bullion held by the Custodian on behalf of the Trust. In addition, the Custodian and the Trustee do not require any direct or indirect sub-custodians to be insured or bonded with respect to their custodial activities or in respect of the Bullion held by them on behalf of the Trust. Further, Shareholders’ recourse against the Trust, the Trustee and the Sponsor under New York law, the Custodian, under English law, and any sub-custodians under the law governing their custody operations is limited. Consequently, a loss may be suffered with respect to the Trust’s Bullion which is not covered by insurance and for which no person is liable in damages.
The Custodian’s limited liability under the Custody Agreements and English law may impair the ability of the Trust to recover losses concerning its Bullion and any recovery may be limited, even in the event of fraud, to the market value of the Bullion at the time the fraud is discovered.
The liability of the Custodian is limited under the Custody Agreements. Under the Custody Agreements between the Trustee and the Custodian which establish the Trust Unallocated Account and the Trust Allocated Account, the Custodian is only liable for losses that are the direct result of its own negligence, fraud or willful default in the performance of its duties. Any such liability is further limited to the market value of the Bullion lost or damaged at the time such negligence, fraud or willful default is discovered by the Custodian, provided the Custodian notifies the Trust and the Trustee promptly after the discovery of the loss or damage. Under each Authorized Participant Unallocated Bullion Account Agreement (between the Custodian and an Authorized Participant establishing an Authorized Participant Unallocated Account), the Custodian is not contractually or otherwise liable for any losses suffered by any Authorized Participant or Shareholder that are not the direct result of its own gross negligence, fraud or willful default in the performance of its duties under such agreement, and in no event will its liability exceed the market value of the balance in the Authorized Participant Unallocated Account at the time such gross negligence, fraud or willful default is discovered by the Custodian. For any Authorized Participant Unallocated Bullion Account Agreement between an Authorized Participant and another Bullion clearing bank, the liability of the Bullion clearing bank to the Authorized Participant may be greater or lesser than the Custodian’s liability to the Authorized Participant described in the preceding sentence, depending on the terms of the agreement. In addition, the Custodian will not be liable for any delay in performance or any non-performance of any of its obligations under the Allocated Account Agreement, the Unallocated Account Agreement or the Authorized Participant Unallocated Bullion Account Agreement by reason of any cause beyond its reasonable control, including acts of God, war or terrorism. As a result, the recourse of the Trustee or a Shareholder, under English law, is limited. Furthermore, under English common law, the Custodian, or any sub-custodian will not be liable for any delay in the performance or any non-performance of its custodial obligations by reason of any cause beyond its reasonable control.
36
The obligations of the Custodian are governed by English law, which may frustrate the Trust in attempting to seek legal redress against the Custodian or any sub-custodian concerning its Bullion.
The obligations of the Custodian under the Custody Agreements are, and the Authorized Participant Unallocated Bullion Account Agreements may be, governed by English law. The Custodian may enter into arrangements with other sub-custodians for the temporary custody of the Trust’s Bullion, which arrangements may also be governed by English law. The Trust is a New York common law trust. Any United States, New York or other court situated in the United States may have difficulty interpreting English law (which, insofar as it relates to custody arrangements, is largely derived from court rulings rather than statute), LBMA or LPPM rules or the customs and practices in the London custody market. It may be difficult or impossible for the Trust to sue any sub-custodian in a United States, New York or other court situated in the United States. In addition, it may be difficult, time consuming and/or expensive for the Trust to enforce in a foreign court a judgment rendered by a United States, New York or other court situated in the United States.
The Trust may not have adequate sources of recovery if its Bullion is lost, damaged, stolen or destroyed.
If the Trust’s Bullion is lost, damaged, stolen or destroyed under circumstances rendering a party liable to the Trust, the responsible party may not have the financial resources sufficient to satisfy the Trust’s claim. For example, as to a particular event of loss, the only source of recovery for the Trust might be limited to the Custodian or any sub- custodian or, to the extent identifiable, other responsible third parties (e.g., a thief or terrorist), any of which may not have the financial resources (including liability insurance coverage) to satisfy a valid claim of the Trust.
Shareholders and Authorized Participants lack the right under the Custody Agreements to assert claims directly against the Custodian and any sub-custodian.
Neither the Shareholders nor any Authorized Participant have a right under the Custody Agreements to assert a claim of the Trust against the Custodian or any sub-custodian. Claims under the Custody Agreements may only be asserted by the Trustee on behalf of the Trust.
Because the Trustee does not, and the Custodian has limited obligations to, oversee or monitor the activities of sub-custodians who may hold the Trust’s Bullion, failure by the sub-custodians to exercise due care in the safekeeping of the Trust’s Bullion could result in a loss to the Trust.
Under the Allocated Account Agreement, the Custodian may appoint from time to time one or more sub-custodians to hold the Trust’s Bullion on a temporary basis pending delivery to the Custodian. Any sub-custodian selected by the Custodian shall be a member of the LBMA or any equity member of the London Precious Metals Clearing Limited, except for the Governor and Company of the Bank of England. As of the date of this report, the sub-custodian that the Custodian currently uses is Brink’s Global Services for silver. The Custodian is required under the Allocated Account Agreement to use reasonable care in appointing any sub-custodian, making the Custodian liable only for negligence or bad faith in the selection of such sub-custodians, and has an obligation to use commercially reasonable efforts to obtain delivery of the Trust’s Bullion from any sub-custodians appointed by the Custodian. Otherwise, the Custodian is not liable for the acts or omissions of its sub-custodians. These sub-custodians may in turn appoint further sub-custodians, but the Custodian is not responsible for the appointment of these further sub-custodians. The Custodian does not undertake to monitor the performance by sub-custodians of their custody functions or their selection of further sub-custodians. The Trustee does not monitor the performance of the Custodian other than to review the reports provided by the Custodian pursuant to the Custody Agreements and does not undertake to monitor the performance of any sub-custodian. Furthermore, the Trustee may have no right to visit the premises of any sub-custodian for the purposes of examining the Trust’s Bullion or any records maintained by the sub-custodian, and no sub-custodian will be obligated to cooperate in any review the Trustee may wish to conduct of the facilities, procedures, records or creditworthiness of such sub-custodian. In addition, the ability of the Trustee to monitor the performance of the Custodian may be limited because under the Allocated Account Agreement and the Unallocated Account Agreement the Trustee has only limited rights to visit the premises of the Custodian for the purpose of examining the Trust’s Bullion and certain related records maintained by the Custodian. See “Custody of the Trust’s Bullion” for more information about sub-custodians that may hold the Trust’s bullion.
37
The obligations of any sub-custodian of the Trust’s Bullion are not determined by contractual arrangements but by LBMA and LPPM rules and London market customs and practices, which may prevent the Trust’s recovery of damages for losses on its Bullion custodied with sub-custodians.
There are expected to be no written contractual arrangements between sub-custodians that hold the Trust’s Bullion and the Trustee or the Custodian because traditionally such arrangements are based on the LBMA’s and the LPPM’s rules and on the customs and practices of the London Bullion markets. In the event of a legal dispute with respect to or arising from such arrangements, it may be difficult to define such customs and practices. The LBMA’s and the LPPM’s rules may be subject to change outside the control of the Trust. Under English law, neither the Trustee nor the Custodian would have a supportable breach of contract claim against a sub-custodian for losses relating to the safekeeping of Bullion. If the Trust’s Bullion is lost or damaged while in the custody of a sub-custodian, the Trust may not be able to recover damages from the Custodian or the sub-custodian. Whether a sub-custodian will be liable for the failure of sub-custodians appointed by it to exercise due care in the safekeeping of the Trust’s Bullion will depend on the facts and circumstances of the particular situation. Shareholders cannot be assured that the Trustee will be able to recover damages from sub-custodians whether appointed by the Custodian or by another sub-custodian for any losses relating to the safekeeping of Bullion by such sub-custodian.
Physical Bullion allocated to the Trust in connection with the creation of a Basket may not meet the Good Delivery Standards and, if a Basket is issued against such Bullion, the Trust may suffer a loss.
Neither the Trustee nor the Custodian independently confirms the fineness of the physical gold, silver, platinum or palladium allocated to the Trust in connection with the creation of a Basket. The Bullion allocated to the Trust by the Custodian may be different from the reported fineness or weight required by the LBMA’s standards for gold and silver bars or the LPPM’s standards for platinum and palladium plates and ingots delivered in settlement of a Bullion trade (“Good Delivery Standards”), the standards required by the Trust. If the Trustee nevertheless issues a Basket against such Bullion, and if the Custodian fails to satisfy its obligation to credit the Trust the amount of any deficiency, the Trust may suffer a loss.
Bullion held in the Trust’s unallocated Bullion account and any Authorized Participant’s unallocated Bullion account will not be segregated from the Custodian’s assets. If the Custodian becomes insolvent, its assets may not be adequate to satisfy a claim by the Trust or any Authorized Participant. In addition, in the event of the Custodian’s insolvency, there may be a delay and costs incurred in identifying the gold and silver bars and platinum and palladium plates and ingots held in the Trust’s allocated Bullion account.
Bullion which is part of a deposit for a purchase order or part of a redemption distribution is held for a time in the Trust Unallocated Account and, previously or subsequently, in the Authorized Participant Unallocated Account of the purchasing or redeeming Authorized Participant. During those times, the Trust and the Authorized Participant, as the case may be, have no proprietary rights to any specific bars of gold or silver or plates or ingots of platinum or palladium held by the Custodian and each is an unsecured creditor of the Custodian with respect to the amount of Bullion held in such unallocated accounts. In addition, if the Custodian fails to allocate the Trust’s Bullion in a timely manner, in the proper amounts or otherwise in accordance with the terms of the Unallocated Account Agreement, or if a sub-custodian fails to so segregate Bullion held by it on behalf of the Trust, unallocated Bullion will not be segregated from the Custodian’s assets, and the Trust will be an unsecured creditor of the Custodian with respect to the amount so held in the event of the insolvency of the Custodian. In the event the Custodian becomes insolvent, the Custodian’s assets might not be adequate to satisfy a claim by the Trust or the Authorized Participant for the amount of Bullion held in their respective unallocated Bullion accounts.
In the case of the insolvency of the Custodian, a liquidator may seek to freeze access to the Bullion held in all of the accounts held by the Custodian, including the Trust Allocated Account. Although the Trust would be able to claim ownership of properly allocated Bullion, the Trust could incur expenses in connection with asserting such claims, and the assertion of such a claim by the liquidator could delay creations and redemptions of Baskets.
In issuing Baskets, the Trustee relies on certain information received from the Custodian which is subject to confirmation after the Trustee has relied on the information. If such information turns out to be incorrect, Baskets may be issued in exchange for an amount of Bullion which is more or less than the amount of Bullion which is required to be deposited with the Trust.
The Custodian’s definitive records are prepared after the close of its business day. However, when issuing Baskets, the Trustee relies on information reporting the amount of Bullion credited to the Trust’s accounts which it receives from the Custodian during the business day and which is subject to correction during the preparation of the Custodian’s definitive records after the close of business. If the information relied upon by the Trustee is incorrect, the amount of Bullion actually received by the Trust may be more or less than the amount required to be deposited for the issuance of Baskets.
GENERAL RISKS
The Trust relies on the information and technology systems of the Trustee, the Custodian, the Marketing Agent and the Sponsor, which could be adversely affected by information systems interruptions, cybersecurity attacks or other disruptions which could have a material adverse effect on the Trust’s record keeping and operations.
The Custodian, the Trustee, the Marketing Agent and the Sponsor depend upon information technology infrastructure, including network, hardware and software systems to conduct their business as it relates to the Trust. A cybersecurity incident, or a failure to protect their computer systems, networks and information against cybersecurity threats, could result in a loss of information and adversely impact their ability to conduct their business, including their business on behalf of the Trust. Despite implementation of network and other cybersecurity measures, their security measures may not be adequate to protect against all cybersecurity threats.
38
War, a major terrorist attack and other geopolitical events, including but not limited to the war between Russia and Ukraine, outbreaks or public health emergencies (as declared by the World Health Organization), the continuation or expansion of war or other hostilities, or a prolonged government shutdown may cause volatility in the price of Bullion due to the importance of a country or region to the Bullion markets, market access restrictions imposed on some local Bullion producers and refiners, potential impacts to global transportation and shipping and other supply chain disruptions. These events are unpredictable and may lead to extended periods of price volatility.
The operations of the Trust, the exchanges, brokers and counterparties with which the Trust does business, and the markets in which the Trust does business, could be severely disrupted in the event of war, a major terrorist attack and other geopolitical events, including but not limited to, the war between Russia and Ukraine, outbreaks or public health emergencies (as declared by the World Health Organization), the continuation or expansion of war or other hostilities, or a prolonged government shutdown. Such events may cause volatility in the price of Bullion due to the importance of a country or region to the Bullion markets, market access restrictions imposed on some local Bullion producers and refiners, or potential impacts to global transportation, shipping, and other supply chain disruptions.
In late February 2022, Russia invaded Ukraine, significantly amplifying already existing geopolitical tensions among Russia and other countries in the region and in the West. The responses of countries and political bodies to Russia’s actions, the larger overarching tensions, and Ukraine’s military response and the potential for wider conflict may increase financial market volatility generally, have severe adverse effects on regional and global economic markets, and cause volatility in the price of Bullion and the share price of the Trust. The conflict in Ukraine, along with global political fallout and implications including sanctions, shipping disruptions, collateral war damage, and a potential expansion of the conflict beyond Ukraine’s borders, could disturb the Bullion markets. Russia is one of the world’s largest producers of gold, palladium, platinum and silver. On March 7, 2022, the LBMA suspended its accreditation of six Russian refiners of gold and silver, and, on April 8, 2022, the LPPM suspended its accreditation of two Russian refiners of platinum and palladium. The LBMA and LPPM each stated that existing bars produced by the refiners before their suspension will still be accepted as good delivery. Fewer suppliers to the LBMA and LPPM may lead to a lower supply of Good Delivery bars or ingots and further volatility in the price of Bullion. Following an announcement at the G7 Summit to collectively ban the import of Russian gold, the UK passed regulations which prohibit the direct or indirect (i) import of gold that originated in Russia, (ii) acquisition of gold that originated in Russia or is located in Russia and (iii) supply or delivery of gold that originated in Russia, all after July 21, 2022. Similarly, US regulations prohibit the import of gold of Russian origin into the United States on or after June 28, 2022 and EU regulations prohibit the direct or indirect import, purchase or transfer of gold if it originates in Russia and has been exported from Russia after July 22, 2022. See “Overview of the Bullion Industry” for a discussion of how the Russian Bullion refiners’ accreditation has impacted the Bullion markets and how Russia’s production levels have impacted Bullion prices subsequent to the suspension.
War and other geopolitical events in eastern Europe, including but not limited to Russia and Ukraine, may cause volatility in commodity prices including precious metals prices. These events are unpredictable and may lead to extended periods of price volatility.
The Trust may be negatively impacted by the effects of the spread of illnesses or other public health emergencies on the global economy and the markets and service providers relevant to the performance of the Trust.
Public health emergencies, such as the COVID-19 pandemic, could have serious negative effects on social, economic and financial systems, including significant uncertainty and volatility in the financial markets. For instance, the suspension of operations of mines, refineries and vaults that extract, produce or store Bullion, restrictions on travel that delay or prevent the transportation of Bullion and an increase in demand for Bullion may disrupt supply chains for Bullion, which could cause secondary market spreads to widen and compromise the Trust’s ability to settle transactions on time. Any inability of the Trust to issue or redeem Shares or the Custodian or any sub-custodian to receive or deliver Bullion as a result of an infectious disease outbreak or public health emergency will negatively affect the Trust’s operations. Future infectious illness outbreaks or other public health emergencies could have similar or other unforeseen impacts and may exacerbate pre-existing political, social and economic risks in certain countries or globally, which could adversely affect the value of the Shares.
Public health emergencies could increase the Trust’s costs and affect liquidity in the market for Bullion, as well as the correlation between the price of the Shares and the net asset value of the Trust, any of which could adversely affect the value of your Shares. In addition, public health emergencies could impair the information technology and other operational systems upon which the Trust’s service providers, including the Sponsor, the Trustee and the Custodian, rely, and could otherwise disrupt the ability of employees of the Trust’s service providers to perform essential tasks on behalf of the Trust. Governmental and quasi-governmental authorities and regulators throughout the world have at times responded to major economic disruptions with a variety of fiscal and monetary policy changes, including, but not limited to, direct capital infusions into companies and other issuers, new monetary tools and lower interest rates. An unexpected or sudden reversal of these policies, or the ineffectiveness of these policies, is likely to increase volatility in the market for Bullion, which could adversely affect the price of the Shares.
39
Further, public health emergencies could interfere with or prevent the operation of the electronic auction hosted by IBA to determine the LBMA Gold Price PM, LBMA Silver Price, LBMA Price PM, which the Trustee uses to value the Bullion held by the Trust and calculate the net asset value of the Trust. Public health emergencies could also cause the closure of futures exchanges, which could eliminate the ability of Authorized Participants to hedge purchases of Baskets, increasing trading costs of Shares and resulting in a sustained premium or discount in the Shares. Each of these outcomes would negatively impact the Trust.
Potential conflicts of interest may arise among the Sponsor or its affiliates and the Trust.
Conflicts of interest may arise among the Sponsor and its affiliates, on the one hand, and the Trust and its Shareholders, on the other hand. As a result of these conflicts, the Sponsor may favor its own interests and the interests of its affiliates over the Trust and its Shareholders. As an example, the Sponsor, its affiliates and their officers and employees are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with the Trust.
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Cybersecurity
The Trust, through its service providers, has processes in place to assess, identify and manage material risks from cybersecurity threats. The Trust’s business is dependent on the communications and information systems of the Trustee, the Sponsor, the Custodian and other third-party service providers. The Trustee is responsible for day-to-day administration of the Trust and has implemented a cybersecurity program that applies to the Trustee and its business, including the administration of the Trust.
Cybersecurity Program Overview
The Trustee has instituted a cybersecurity program designed to identify, assess and mitigate cyber risks applicable to the administration by the Trustee of the Trust. The cyber risk management program involves risk assessments, implementation of security measures and ongoing monitoring of systems and networks, including networks on which the Trust relies. The Trustee actively monitors the current threat landscape to seek to identify material risks arising from new and evolving cybersecurity threats, including material risks faced by the Trust.
The Trust relies on the Trustee, the Sponsor and the Custodian to engage external experts, including cybersecurity assessors, risk management and information technology professionals, attorneys, consultants and auditors to evaluate cybersecurity measures and risk management processes, including those applicable to the Trust.
Board Oversight of Cybersecurity Risks
Management’s Role in Cybersecurity Risk Management
Assessment of Cybersecurity Risk
The potential impact of risks from cybersecurity
threats to the Trust are assessed by the Trustee, the Sponsor, the Custodian and third-party service providers on an ongoing basis,
and how such risks could materially affect the Trust’s objective, operational results and financial condition are regularly
evaluated.
40
Item 2. Properties
Not applicable.
Item 3. Legal Proceedings
None
Item 4. Mine Safety Disclosure
Not applicable.
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
On October 22, 2010, the Trust’s Shares commenced trading on the NYSE Arca under the symbol GLTR, and the Trust commenced operations, began accruing expenses and began the calculation of NAV.
The following tables set out the range of high and low closing prices for the Shares as reported for NYSE Arca transactions for each of the quarters during the years ended December 31, 2025 and 2024:
| Fiscal Year Ended December 31, 2025: Quarter Ended | |||||||||
| High | Low | ||||||||
| March 31, 2025 | $ | 129.47 | $ | 111.02 | |||||
| June 30, 2025 | $ | 141.61 | $ | 120.00 | |||||
| September 30, 2025 | $ | 165.48 | $ | 127.99 | |||||
| December 31, 2025 | $ | 222.47 | $ | 163.71 | |||||
| Fiscal Year Ended December 31, 2024: Quarter Ended | |||||||||
| High | Low | ||||||||
| March 31, 2024 | $ | 95.61 | $ | 85.44 | |||||
| June 30, 2024 | $ | 109.58 | $ | 95.86 | |||||
| September 30, 2024 | $ | 115.87 | $ | 101.06 | |||||
| December 31, 2024 | $ | 121.85 | $ | 108.76 | |||||
The number of outstanding Shares of the Trust as of February 26, 2026 was 13,500,000.
Monthly Share Price
The following table sets forth, for each of the most recent six months, the high and low closing prices of the Shares, as reported for NYSE Arca transactions.
| Month | High | Low | |||||||
| August 2025 | $ | 145.97 | $ | 139.43 | |||||
| September 2025 | $ | 165.48 | $ | 147.41 | |||||
| October 2025 | $ | 188.67 | $ | 163.71 | |||||
| November 2025 | $ | 186.49 | $ | 168.24 | |||||
| December 2025 | $ | 222.47 | $ | 185.67 | |||||
| January 2026 | $ | 295.00 | $ | 206.64 | |||||
41
Issuer Purchase of Equity Securities
The Trust issues and redeems Shares only with Authorized Participants in exchange for Bullion, only in aggregations of 25,000 Shares (effective June 18, 2024, the Trustee, in consultation with the Sponsor, has determined that the number of Shares comprising a Basket for the abrdn Precious Metals Basket ETF Trust shall be reduced from 50,000 Shares to 25,000 Shares) or integral multiples thereof. A list of current Authorized Participants is available from the Sponsor or the Trustee and is included in Item 7 of this report. Although the Trust does not purchase Shares directly from its Shareholders, in connection with the redemption of Baskets, the Trust redeemed as follows during the years ended December 31, 2025 and 2024:
| Month | Total number of Shares redeemed | Gold | Average ounces of Bullion per Share Palladium | Platinum | Silver | ||||||||||||||||
| January 2025 | — | — | — | — | — | ||||||||||||||||
| February 2025 | — | — | — | — | — | ||||||||||||||||
| March 2025 | — | — | — | — | — | ||||||||||||||||
| April 2025 | 150,000 | 0.027 | 0.005 | 0.004 | 1.008 | ||||||||||||||||
| May 2025 | 175,000 | 0.027 | 0.005 | 0.004 | 1.008 | ||||||||||||||||
| June 2025 | — | — | — | — | — | ||||||||||||||||
| July 2025 | — | — | — | — | — | ||||||||||||||||
| August 2025 | — | — | — | — | — | ||||||||||||||||
| September 2025 | — | — | — | — | — | ||||||||||||||||
| October 2025 | — | — | — | — | — | ||||||||||||||||
| November 2025 | — | — | — | — | — | ||||||||||||||||
| December 2025 | 175,000 | 0.027 | 0.005 | 0.004 | 1.004 | ||||||||||||||||
| Total | 500,000 | ||||||||||||||||||||
| Month | Total number of Shares redeemed | Gold | Average ounces of Bullion per Share Palladium | Platinum | Silver | ||||||||||||||||
| January 2024 | 100,000 | 0.028 | 0.006 | 0.004 | 1.016 | ||||||||||||||||
| February 2024 | 350,000 | 0.028 | 0.006 | 0.004 | 1.015 | ||||||||||||||||
| March 2024 | 100,000 | 0.028 | 0.006 | 0.004 | 1.015 | ||||||||||||||||
| April 2024 | 50,000 | 0.028 | 0.006 | 0.004 | 1.014 | ||||||||||||||||
| May 2024 | 150,000 | 0.028 | 0.006 | 0.004 | 1.014 | ||||||||||||||||
| June 2024 | 150,000 | 0.028 | 0.006 | 0.004 | 1.014 | ||||||||||||||||
| July 2024 | — | — | — | — | — | ||||||||||||||||
| August 2024 | 200,000 | 0.028 | 0.006 | 0.004 | 1.012 | ||||||||||||||||
| September 2024 | — | — | — | — | — | ||||||||||||||||
| October 2024 | — | — | — | — | — | ||||||||||||||||
| November 2024 | — | — | — | — | — | ||||||||||||||||
| December 2024 | 75,000 | 0.028 | 0.006 | 0.004 | 1.010 | ||||||||||||||||
| Total | 1,175,000 | ||||||||||||||||||||
Item 6. [Reserved]
42
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This information should be read in conjunction with the financial statements and notes to the financial statements included with this report. The discussion and analysis that follows may contain statements that relate to future events or future performance. In some cases, such forward-looking statements can be identified by terminology such as “may,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or the negative of these terms or other comparable terminology. We remind readers that forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future results, performance, levels of activity, or our achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Trust undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Introduction.
The abrdn Precious Metals Basket ETF Trust (the “Trust”) is a trust formed under the laws of the State of New York. The Trust does not have any officers, directors, or employees, and is administered by The Bank of New York Mellon (the “Trustee”) acting as trustee pursuant to the Depositary Trust Agreement (the “Trust Agreement”) between the Trustee and abrdn ETFs Sponsor LLC the sponsor of the Trust (the “Sponsor”). The Trust issues shares (“Shares”) representing fractional undivided beneficial interests in its net assets. The assets of the Trust consist of gold, silver, platinum and palladium bullion (“Bullion”) held by a custodian as an agent of the Trust and responsible only to the Trustee.
The Trust is a passive investment vehicle and the objective of the Trust is for the value of each Share to approximately reflect, at any given time, the price of the Bullion owned by the Trust, less the Trust’s liabilities (anticipated to be principally for accrued operating expenses), divided by the number of outstanding Shares. The Trust does not engage in any activities designed to obtain a profit from, or ameliorate losses caused by, changes in the price of Bullion.
The Trust issues and redeems Shares only in exchange for Bullion, only in aggregations of 25,000 Shares or integral multiples thereof (each, a “Basket”), and only in transactions with registered broker-dealers, or other securities market participants not required to register as broker-dealers, such as a bank or other financial institution, that (1) are participants in DTC and (2) have previously entered into an agreement with the Trust governing the terms and conditions of such issuance (such dealers, the “Authorized Participants”). As of the date of this annual report the Authorized Participants that have signed an Authorized Participant Agreement with the Trust are Goldman Sachs & Co., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Merrill Lynch Professional Clearing Corp., Mizuho Securities USA LLC, Morgan Stanley & Co. Inc., Scotia Capital (USA) LLC, UBS Securities LLC and Virtu Americas, LLC.
Shares of the Trust trade on the NYSE Arca under the symbol “GLTR.”
Investing in the Shares does not insulate the investor from certain risks, including price volatility. The following table illustrates the movement in the NAV of the Shares against the price per ounce of gold, silver, platinum and palladium in the proportions held by the Trust (the “Proportionate Price”) since inception.
The divergence of the NAV per Share from the Proportionate Price over time reflects the cumulative effect of the Trust expenses that arise if an investment had been held since inception.
Critical Accounting Policy
The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements relies on estimates and assumptions that impact the Trust’s financial position and results of operations. These estimates and assumptions affect the Trust’s application of accounting policies. Below we describe the valuation of Bullion, a critical accounting policy that we believe is important to understanding the results of operations and financial position. In addition, please refer to Note 2 to the Financial Statements for further discussion of our accounting policies.
43
Valuation of Bullion
The Trust’s Bullion is recorded, per individual metal type, at fair value. The cost of Bullion is determined according to the average cost method and the fair value is based on the relevant “London Metal Price” for each metal held by the Trust. The cost of gold is determined according to the average cost method and the fair value is based on the LBMA PM Gold Price. For silver this is the LBMA Silver Price as established by the seven LBMA authorised bullion banks. For platinum and palladium this is the “LBMA Price PM” for platinum or palladium (as applicable) of the price of an ounce of such metal performed in London, England by fixing members of the LPPM. Realized gains and losses on transfers of Bullion, or Bullion distributed for the redemption of Shares, are calculated on a trade date basis as the difference between the fair value and cost of Bullion transferred.
Once the value of Bullion has been determined, the NAV is computed by the Trustee by deducting all accrued fees and other liabilities of the Trust, including the remuneration due to the Sponsor (the “Sponsor’s Fee”), from the fair value of the Bullion and all other assets held by the Trust.
December 31, 2025 | December 31, 2024 | December 31, 2023 | ||||||||||
| (Amounts in 000’s of US$) | ||||||||||||
| Investment in Bullion - cost | $ | 1,252,985 | $ | 770,093 | $ | 845,552 | ||||||
| Unrealized gain on investment in Bullion | 1,310,276 | 270,396 | 113,771 | |||||||||
| Investment in Bullion - fair value | $ | 2,563,261 | $ | 1,040,489 | $ | 959,323 | ||||||
Inspection of Bullion
Under the Custody Agreements, the Trustee, the Sponsor and the Trust’s auditors and inspectors may, only up to twice a year, visit the premises of the Custodian and the Zurich Sub-Custodian for the purpose of examining the Trust’s Bullion and certain related records maintained by the Custodian. Under the Allocated Account Agreement, the Custodian agreed to procure similar inspection rights from the Zurich Sub-Custodian. Visits by auditors and inspectors to the Zurich Sub-Custodian’s facilities will be arranged through the Custodian. Other than with respect to the Zurich Sub-Custodian, the Trustee and the Sponsor have no right to visit the premises of any sub-custodian for the purposes of examining the Trust’s Bullion or any records maintained by the sub-custodian and no sub-custodian is obligated to cooperate in any review the Trustee or the Sponsor may wish to conduct of the facilities, procedures, records or creditworthiness of such sub-custodian.
The Sponsor has exercised its right to visit the Custodian in order to examine the Bullion and the records maintained by the Custodian. An inspection was conducted by Bureau Veritas Commodities UK Ltd, a leading commodity inspection and testing company retained by the Sponsor, as of August 4, 2025 and January 5,2026.
There can be no guarantee that the Sponsor or the Trust’s auditors and inspectors will be able to perform physical inspections of the Trust’s Bullion as planned. Local policies, regulations, or ordinances, as well as polices or restrictions adopted by the Custodian or a sub-custodian, may temporarily prevent, or otherwise impair the ability of, the Sponsor or the Trust’s auditors and inspectors, from performing a physical inspection of the Trust’s Bullion on a desired date. In those situations, the Sponsor or the Trust’s auditors and inspectors may seek to verify the Bullion held by the Trust by alternate means, including through virtual inspections of the Trust’s Bullion and/or a review of pertinent records.
Liquidity and Capital Resources
The Trust is not aware of any trends, demands, conditions, events or uncertainties that are reasonably likely to result in material changes to its liquidity needs. In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume most of the expenses incurred by the Trust. As a result, the only expense of the Trust during the period covered by this report was the Sponsor’s Fee. The Trust’s only source of liquidity is its transfers and sales of Bullion.
The Trustee will, at the direction of the Sponsor or in its own discretion, sell the Trust’s Bullion (only in the specified proportion of gold, silver, platinum and palladium held by the Trust) as necessary to pay the Trust’s expenses not otherwise assumed by the Sponsor. The Trustee will not sell Bullion to pay the Sponsor’s Fee but will pay the Sponsor’s Fee through in-kind transfers of Bullion to the Sponsor. At December 31, 2025 and 2024, the Trust did not have any cash balances.
44
Results of Operations
Financial Highlights
Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||
| (Amounts in 000’s of US$) | ||||||||||||
| Total gain/(loss) on Bullion | $ | 1,075,773 | $ | 176,343 | $ | 33,453 | ||||||
| Net change assets from operations | $ | 1,066,234 | $ | 170,283 | $ | 27,533 | ||||||
| Net cash provided by operating activities | $ | — | $ | — | $ | — | ||||||
The net asset value of the Trust will be obtained by subtracting the Trust’s expenses and liabilities on any day from the value of the Bullion owned by the Trust on that day; the NAV per Share will be obtained by dividing the net asset value of the Trust on a given day by the number of Shares outstanding on that day. On each day on which the Exchange is open for regular trading, the Trustee will determine the net asset value of the Trust and the NAV per Share as promptly as practicable after 4:00 p.m. (New York time). The Trustee will value the Trust’s gold on the basis of LBMA Gold Price PM. If there is no LBMA Gold Price PM on any day, the Trustee is authorized to use the LBMA Gold Price AM announced on that day. If neither price is available for that day, the Trustee will value the Trust’s gold based on the most recently announced LBMA Gold Price PM or LBMA Gold Price AM. The Trustee will value the Trust’s platinum and palladium on the basis of the respective LBMA Price PM. If there is no LBMA Price PM for platinum or palladium on any day, the Trustee is authorized to use the LBMA Price AM for such metal announced on that day. If neither price is available for that day, the Trustee will value the Trust’s platinum or palladium based on the most recently announced LBMA Price PM or LBMA Price AM for such metal. The Trustee will value the Trust’s silver on the basis of LBMA Silver Price. If there is no LBMA Silver Price on a particular evaluation day, the next most recent LBMA Silver Price announced for silver will be used in the determination of the NAV of the Trust, unless the Sponsor determines that such price is inappropriate to use as basis for such determination. If the Sponsor determines that a London Metal Price is inappropriate to use, the Sponsor will identify an alternate basis for evaluation to be employed by the Trustee. Further, the Sponsor may instruct the Trustee to use on an on-going basis a different publicly available price which the Sponsor determines to fairly represent the commercial value of the Trust’s Bullion.
The year ended December 31, 2025
The Trust’s NAV increased from $1,039,953,142 at December 31, 2024 to $2,577,422,977 at December 31, 2025, a 147.84% increase for the year. The change in the Trust’s NAV resulted from a increase in outstanding Shares, which rose from 9,500,000 Shares at December 31, 2024 to 12,500,000 at December 31, 2025, a result of 3,500,000 Shares (140 Baskets) being created and 500,000 Shares (20 Baskets) being redeemed and the price per ounce of gold, silver, platinum and palladium in the proportions held by the Trust (the “Proportionate Price”) rose 89.50% from $119.23 at December 31, 2024 to $225.94 at December 31, 2025.
The NAV per Share increased 88.35% from $109.47 at December 31, 2024 to $206.19 at December 31, 2025. The Trust’s NAV per Share rose slightly less than the Proportionate Price on a percentage basis due to the Sponsor’s Fee, which was $9,539,023 for the year, or 0.60% of the Trust’s ANAV.
The NAV per Share of $213.53 at December 24, 2025 was the highest during the year, compared with a low of $109.47 at January 2, 2025.
The increase in net assets from operations for the year ended December 31, 2025 was $1,066,234,670, resulting from a realized gain of $3,292,453 on Bullion transferred to pay expenses, a realized gain of $32,599,933 on Bullion distributed for the redemption of Shares, a change in unrealized gain on investment in Bullion of $1,039,881,307, offset by the Sponsor’s Fee of $9,539,023. Other than the Sponsor’s Fee, the Trust had no expenses during the year ended December 31, 2025.
The year ended December 31, 2024
The Trust’s NAV increased from $958,830,648 at December 31, 2023 to $1,039,953,142 at December 31, 2024, a 8.46% increase for the year. The change in the Trust’s NAV resulted from a decrease in outstanding Shares, which fell from 10,450,000 Shares at December 31, 2023 to 9,500,000 Shares at December 31, 2024, a result of 225,000 Shares (9 Baskets) being created and 1,175,000 Shares (47 Baskets) being redeemed and the price per ounce of gold, silver, platinum and palladium in the proportions held by the Trust (the “Proportionate Price”) rose 20.02% from $99.34 at December 31, 2023 to $119.23 at December 31, 2024.
45
The NAV per Share increased 19.31% from $91.75 at December 31, 2023 to $109.47 at December 31, 2024. The Trust’s NAV per Share rose slightly less than the Proportionate Price on a percentage basis due to the Sponsor’s Fee, which was $6,060,263 for the year, or 0.60% of the Trust’s ANAV.
The NAV per Share of $121.47 at October 29, 2024 was the highest during the year, compared with a low of $85.65 at February 14, 2024.
The increase in net assets from operations for the year ended December 31, 2024 was $170,282,596, resulting from a realized gain of $1,235,668 on Bullion transferred to pay expenses, a realized gain of $18,482,768 on Bullion distributed for the redemption of Shares, a change in unrealized gain on investment in Bullion of $156,624,422, offset by the Sponsor’s Fee of $6,060,263. Other than the Sponsor’s Fee, the Trust had no expenses during the year ended December 31, 2024.
The year ended December 31, 2023
The Trust’s NAV decreased from $1,007,501,383 at December 31, 2022 to $958,830,648 at December 31, 2023, a 4.83% decrease for the year. The change in the Trust’s NAV resulted from a decrease in outstanding Shares, which fell from 11,350,000 Shares at December 31, 2022 to 10,450,000 Shares at December 31, 2023, a result of 800,000 Shares (16 Baskets) being created and 1,700,000 Shares (34 Baskets) being redeemed and the price per ounce of gold, silver, platinum and palladium in the proportions held by the Trust (the “Proportionate Price”) rose 3.80% from $95.70 at December 31, 2022 to $99.34 at December 31, 2023.
The NAV per Share increased 3.36% from $88.77 at December 31, 2022 to $91.75 at December 31, 2023. The Trust’s NAV per Share rose slightly less than the Proportionate Price on a percentage basis due to the Sponsor’s Fee, which was $5,919,545 for the year, or 0.60% of the Trust’s ANAV.
The NAV per Share of $95.88 at May 10, 2023 was the highest during the year, compared with a low of $81.51 at October 6, 2023.
The increase in net assets from operations for the year ended December 31, 2023 was $27,533,575, resulting from a realized gain of $520,149 on Bullion transferred to pay expenses, a realized gain of $10,487,437 on Bullion distributed for the redemption of Shares, a change in unrealized gain on investment in Bullion of $22,445,534, offset by the Sponsor's Fee of $5,919,545. Other than the Sponsor's Fee, the Trust had no expenses during the year ended December 31, 2023.
Off-Balance Sheet Arrangements
The Trust is not a party to any off-balance sheet arrangements.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
The Trust Agreement does not authorize the Trustee to borrow for payment of the Trust’s ordinary expenses. The Trust does not engage in transactions in foreign currencies which could expose the Trust or holders of Shares to any foreign currency related market risk. The Trust invests in no derivative financial instruments and has no foreign operations or long-term debt instruments.
Item 8. Financial Statements and Supplementary Data (Unaudited)
Quarterly Income Statements
Year Ended December 31, 2025
| Three months ended | ||||||||||||||||||||
| (Amounts in 000’s of US$, except for Share and per Share data) | March 31 | June 30 | September 30 | December 31 | Year ended December 31 | |||||||||||||||
| EXPENSES | ||||||||||||||||||||
| Sponsor’s Fee | $ | 1,761 | $ | 2,034 | $ | 2,415 | $ | 3,329 | $ | 9,539 | ||||||||||
| Total expenses | 1,761 | 2,034 | 2,415 | 3,329 | 9,539 | |||||||||||||||
| Net investment loss | (1,761 | ) | (2,034 | ) | (2,415 | ) | (3,329 | ) | (9,539 | ) | ||||||||||
| REALIZED AND UNREALIZED GAINS / (LOSSES) | ||||||||||||||||||||
| Realized gain on platinum transferred to pay expenses | 474 | 680 | 855 | 1,283 | 3,292 | |||||||||||||||
| Realized gain / (loss) on platinum distributed for the redemption of Shares | — | 14,407 | — | 18,193 | 32,600 | |||||||||||||||
| Change in unrealized gain / (loss) on investment in platinum | 193,296 | 75,080 | 283,601 | 487,904 | 1,039,881 | |||||||||||||||
| Total gain / (loss) on investment in platinum | 193,770 | 90,167 | 284,456 | 507,380 | 1,075,773 | |||||||||||||||
| Change in net assets from operations | $ | 192,009 | $ | 88,133 | $ | 282,041 | $ | 504,051 | $ | 1,066,234 | ||||||||||
| Net increase / (decrease) in net assets per Share | $ | 19.64 | $ | 8.55 | $ | 26.40 | $ | 42.11 | $ | 99.74 | ||||||||||
| Weighted average number of Shares | 9,776,667 | 10,309,341 | 10,683,424 | 11,968,750 | 10,690,548 | |||||||||||||||
46
Year Ended December 31, 2024
| Three months ended | ||||||||||||||||||||
| (Amounts in 000’s of US$, except for Share and per Share data) | March 31 | June 30 | September 30 | December 31 | Year ended December 31 | |||||||||||||||
| EXPENSES | ||||||||||||||||||||
| Sponsor’s Fee | $ | 1,377 | $ | 1,499 | $ | 1,556 | $ | 1,628 | $ | 6,060 | ||||||||||
| Total expenses | 1,377 | 1,499 | 1,556 | 1,628 | 6,060 | |||||||||||||||
| Net investment loss | (1,377 | ) | (1,499 | ) | (1,556 | ) | (1,628 | ) | (6,060 | ) | ||||||||||
| REALIZED AND UNREALIZED GAINS / (LOSSES) | ||||||||||||||||||||
| Realized gain on platinum transferred to pay expenses | 133 | 281 | 346 | 476 | 1,236 | |||||||||||||||
| Realized gain / (loss) on platinum distributed for the redemption of Shares | 4,075 | 8,044 | 4,156 | 2,208 | 18,483 | |||||||||||||||
| Change in unrealized gain / (loss) on investment in platinum | 28,725 | 73,798 | 90,075 | (35,974 | ) | 156,624 | ||||||||||||||
| Total gain / (loss) on investment in platinum | 32,933 | 82,123 | 94,577 | (33,920 | ) | 176,343 | ||||||||||||||
| Change in net assets from operations | $ | 31,556 | $ | 80,624 | $ | 93,021 | $ | (34,918 | ) | $ | 170,283 | |||||||||
| Net increase / (decrease) in net assets per Share | $ | 3.11 | $ | (5.17 | ) | $ | 9.76 | $ | 10.98 | $ | 17.48 | |||||||||
| Weighted average number of Shares | 10,162,637 | 11,334,066 | 9,528,804 | 9,504,076 | 9,744,194 | |||||||||||||||
Note: Quarterly balances may not add to totals due to independent rounding.
The financial statements required by Regulation S-X, together with the report of the Trust’s independent registered public accounting firm appear on pages F-1 to F-13 of this filing.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
The Trust maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to the Chief Executive Officer and Chief Financial Officer of the Sponsor, and to the audit committee, as appropriate, to allow timely decisions regarding required disclosure.
Under the supervision and with the participation of the Chief Executive Officer and the Chief Financial Officer of the Sponsor, the Sponsor conducted an evaluation of the Trust’s disclosure controls and procedures, as defined under Exchange Act Rules 13a-15(e) and 15d-15(e). Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer of the Sponsor concluded that, as of December 31, 2025, the Trust’s disclosure controls and procedures were effective.
Internal controls over financial reporting have been maintained throughout the Trust’s fiscal year ended December 31, 2025. There have been no changes that have materially affected, or are reasonably likely to materially affect, the Trust’s or Sponsor’s internal control over financial reporting.
Management’s Report on Internal Control over Financial Reporting
The Sponsor’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined under Exchange Act Rules 13a-15(f) and 15d-15(f). The Trust’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Internal control over financial reporting includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Trust’s assets;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Trust’s receipts and expenditures are being made only in accordance with appropriate authorizations; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Trust’s assets that could have a material effect on the financial statements.
47
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become ineffective because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
The Chief Executive Officer and Chief Financial Officer of the Sponsor assessed the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2025. In making this assessment, they used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Their assessment included an evaluation of the design of the Trust’s internal control over financial reporting and testing of the operational effectiveness of its internal control over financial reporting. Based on their assessment and those criteria, the Chief Executive Officer and Chief Financial Officer of the Sponsor concluded that the Trust maintained effective internal control over financial reporting as of December 31, 2025.
KPMG LLP, the independent registered public accounting firm that audited and reported on the financial statements included in this Form 10-K, as stated in their report which is included herein, issued an attestation report on the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2025.
Report of Independent Registered Public Accounting Firm
Item 9B. Other Information
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
48
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The Trust has no officers, employees or board
of trustees and is administered by the Trustee pursuant to the Trust Agreement. Accordingly, the Trust has
Steven Dunn – President and Chief Executive Officer
Mr. Dunn, CIMA®, is the Head of Exchange Traded Funds at abrdn Inc. Mr. Dunn guides the firm’s strategic direction and distribution strategy for ETFs. Previously, he was a Director with Deutsche Asset and Wealth Management in charge of managing relationships with US ETF Strategists and overseeing the Eastern Division sales team. Prior to that, Mr. Dunn was a consultant at Brandywine Global Investment Management and has also held sales and distribution strategy positions at iShares, Blackrock and Vanguard. Mr. Dunn holds a B.A. degree in Public Administration from Shippensburg University of Pennsylvania and has completed his MBA at Pennsylvania State University. He holds the Series 7, 24, and 63 registrations as well as the Certified Investment Management Analyst® (CIMA®).
Sharon Ferrari – Chief Financial Officer and Treasurer
Sharon Ferrari is currently a Director, Product Management at abrdn Inc. (the parent company of the Sponser). Ms. Ferrari joined abrdn Inc. in 2008. Prior to working at abrdn Inc., Ms. Ferrari worked at Delaware Investments for about 3 years and began her career at SEI Investments. Ms. Ferrari holds a BS in Business Administration from University of Pittsburgh and a MBA from Villanova University.
Item 11. Executive Compensation
The Trust has no directors or executive officers. The only ordinary expense paid by the Trust is the Sponsor’s Fee.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Security Ownership of Certain Beneficial Owners
There are no persons known by the Trust to own directly or indirectly beneficially more than 5% of the outstanding Shares of the Trust.
Security Ownership of Management
Not applicable.
Change in Control
Neither the Sponsor nor the Trustee knows of any arrangements which may subsequently result in a change in control of the Trust.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The Trust has no directors or executive officers.
Item 14. Principal Accounting Fees and Services
Fees for services performed by KPMG LLP for the years ended December 31, 2025 and 2024
| December 31, 2025 | December 31, 2024 | |||||||
| Audit fees – KPMG | $ | 80,000 | $ | 94,000 | ||||
| Audit related fees - KPMG | — | — | ||||||
| $ | 80,000 | $ | 94,000 | |||||
49
Audit Fees are fees paid by the Sponsor to KPMG LLP for professional services for the audit of the Trust’s financial statements included in the Form 10-K and review of financial statements included in the Form 10-Qs, and for services that are normally provided by the accountants in connection with regulatory filings or engagements. Audit Related Fees are paid by the Sponsor to KPMG LLP for assurance and related services that are reasonably related to the performance of the audit or review of the Trust’s financial statements. These services include the accountant providing a consent letter related to the Trust’s registration statement filing.
Pre-Approval Policies and Procedures
As referenced in Item 10 above, the Trust has no board of directors, and as a result, has no pre-approval policies or procedures with respect to fees paid to KPMG LLP. Such determinations are made by the Sponsor.
PART IV
Item 15. Exhibits, Financial Statement Schedules
1. Financial Statements
See Index to Financial Statements on Page F-1 for a list of the financial statements being filed herein.
2. Financial Statement Schedules
Schedules have been omitted since they are either not required, not applicable, or the information has otherwise been included.
3. Exhibits
| 23.1 | Consent of KPMG LLP, Independent Registered Public Accounting Firm |
| 31.1 | Chief Executive Officer’s Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
50
| 31.2 | Chief Financial Officer’s Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 32.1 | Chief Executive Officer’s Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| 32.2 | Chief Financial Officer’s Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| 97.1 | Policy for Recovery of Erroneously Awarded Compensation, incorporated by reference to Exhibit 97.1 filed with the Trust’s Annual Report of Form 10-K on February 29, 2024. |
| 101 | The following financial statements from the Trust’s Annual Report on Form 10-K for the year ended December 31, 2025, formatted in Inline XBRL: (i) Statements of Assets and Liabilities, (ii) Statements of Operations, (iii) Statements of Changes in Net Assets, and (iv) Notes to the Financial Statements. |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Document |
| 101.DEF | Inline XBRL Taxonomy Extension Definitions Document |
| 101.LAB | Inline XBRL Taxonomy Extension Labels Document |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Document |
| 104 | The cover page from the Trust’s Annual Report on Form 10-K for the year ended December 31, 2025 formatted in Inline XBRL (included as Exhibit 101). |
Item 16. Form 10-K Summary
Not applicable.
51
ABRDN PRECIOUS METALS BASKET ETF TRUST
Financial Statements as of December 31, 2025 Index
F-1
Suite 4000
1735 Market Street
Philadelphia, PA 19103-7501
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Sponsor, Trustee and Shareholders
abrdn Precious Metals Basket ETF Trust:
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities of abrdn Precious Metals Basket ETF Trust (the Trust) including the schedules of investments, as of December 31, 2025 and December 31, 2024, the related statements of operations and changes in net assets and the financial highlights for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2025 and December 31, 2024, and the results of its operations, changes in its net assets and financial highlights for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Trust’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 2, 2026 expressed an unqualified opinion on the effectiveness of the Trust’s internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which they relate.
| KPMG LLP, a Delaware limited liability partnership, and its subsidiaries are part of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. |
F-2
Evaluation of the evidence pertaining to the existence of the bullion holdings
As presented on the December 31, 2025 schedule of investments and in Note 2.2, the fair value of the Trust's investment in bullion is $2,563,261 thousand, representing 99.46% of the Trust's net assets, and 12,933,297.0 ounces of bullion holdings. The investment in bullion was held by a third-party custodian or sub-custodian (collectively, the custodian).
We identified the evaluation of the evidence pertaining to the existence of the bullion holdings as a critical audit matter. Given the nature and volume of the bullion holdings, subjective auditor judgment was required to evaluate the extent and nature of evidence obtained to assess the existence of bullion held by the custodian.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the critical audit matter. This included controls over (1) the comparison of the Trust's records of bullion held to the custodian's records, (2) the approval of bullion deposits and withdrawals by the trustee of the Trust and (3) the physical counts of the Trust's bullion holdings performed at the custodian's locations by a third party engaged by the Trust's sponsor. We obtained a schedule directly from the custodian of the Trust's bullion holdings held by the custodian as of December 31, 2025. We compared the total ounces on such schedule to the Trust's record of bullion holdings. We also attended and observed a part of the physical counts of the Trust's bullion holdings. We obtained and read the physical counts results reports of the third party and reconciled those reports to both the Trust's and custodian's records.
We have served as the Trust’s auditor since 2015.
March 2, 2026
F-3
abrdn Precious Metals Basket ETF Trust
Statements of Assets and Liabilities
At December 31, 2025 and 2024
| December 31, 2025 | December 31, 2024 | |||||||
| (Amounts in 000’s of US$, except for Share and per Share data) | ||||||||
| ASSETS | ||||||||
| Gold (cost: December 31, 2025: $ | $ | $ | ||||||
| Palladium (cost: December 31, 2025: $ | ||||||||
| Platinum (cost: December 31, 2025: $ | ||||||||
| Silver (cost: December 31, 2025: $ | ||||||||
| Total investment in Bullion | ||||||||
| Bullion receivable | ||||||||
| Total assets | ||||||||
| LIABILITIES | ||||||||
| Fees payable to Sponsor | ||||||||
| Total liabilities | ||||||||
| NET ASSETS(1) | $ | $ | ||||||
| (1) |
See Notes to the Financial Statements
F-4
abrdn Precious Metals Basket ETF Trust
Schedules of Investments
At December 31, 2025 and 2024
| December 31, 2025 | ||||||||||||||||
| Description | oz | Cost | Fair Value | % of Net Assets | ||||||||||||
| Investment in Bullion (in 000’s of US$, except for oz and percentage data) | ||||||||||||||||
| Gold | $ | $ | % | |||||||||||||
| Palladium | % | |||||||||||||||
| Platinum | % | |||||||||||||||
| Silver | % | |||||||||||||||
| Total investment in Bullion | $ | $ | % | |||||||||||||
| Other assets less liabilities | % | |||||||||||||||
| Net Assets | $ | % | ||||||||||||||
| December 31, 2024 | ||||||||||||||||
| Description | oz | Cost | Fair Value | % of Net Assets | ||||||||||||
| Investment in Bullion (in 000’s of US$, except for oz and percentage data) | ||||||||||||||||
| Gold | $ | $ | % | |||||||||||||
| Palladium | % | |||||||||||||||
| Platinum | % | |||||||||||||||
| Silver | % | |||||||||||||||
| Total investment in Bullion | $ | $ | % | |||||||||||||
| Less liabilities | ( | ) | ( | )% | ||||||||||||
| Net Assets | $ | % | ||||||||||||||
See Notes to the Financial Statements
F-5
abrdn Precious Metals Basket ETF Trust
Statements of Operations
For the years ended December 31, 2025, 2024, and 2023
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||
| (Amounts in 000’s of US$, except for Share and per Share data) | ||||||||||||
| EXPENSES | ||||||||||||
| Sponsor’s Fee | $ | $ | $ | |||||||||
| Total expenses | ||||||||||||
| Net investment loss | ( | ) | ( | ) | ( | ) | ||||||
| REALIZED AND UNREALIZED GAINS / (LOSSES) | ||||||||||||
| Realized gain on Bullion transferred to pay expenses | ||||||||||||
| Realized gain on Bullion distributed for the redemption of Shares | ||||||||||||
| Change in unrealized gain on investment in Bullion | ||||||||||||
| Total gain on investment in Bullion | ||||||||||||
| Change in net assets from operations | $ | $ | $ | |||||||||
| Net increase in net assets per Share | $ | $ | $ | |||||||||
| Weighted average number of Shares | ||||||||||||
See Notes to the Financial Statements
F-6
abrdn Precious Metals Basket ETF Trust
Statements of Changes in Net Assets
For the years ended December 31, 2025, 2024 and 2023
| Year Ended December 31, 2025 | ||||||||
| (Amounts in 000’s of US$, except for Share data) | Shares | Amount | ||||||
| Opening balance at January 1, 2025 | $ | |||||||
| Net investment loss | ( | ) | ||||||
| Realized gain on investment in Bullion | ||||||||
| Change in unrealized gain on investment in Bullion | ||||||||
| Creations | ||||||||
| Redemptions | ( | ) | ( | ) | ||||
| Closing balance at December 31, 2025 | $ | |||||||
| Year Ended December 31, 2024 | ||||||||
| (Amounts in 000’s of US$, except for Share data) | Shares | Amount | ||||||
| Opening balance at January 1, 2024 | $ | |||||||
| Net investment loss | ( | ) | ||||||
| Realized gain on investment in Bullion | ||||||||
| Change in unrealized gain on investment in Bullion | ||||||||
| Creations | ||||||||
| Redemptions | ( | ) | ( | ) | ||||
| Closing balance at December 31, 2024 | $ | |||||||
| Year Ended December 31, 2023 | ||||||||
| (Amounts in 000’s of US$, except for Share data) | Shares | Amount | ||||||
| Opening balance at January 1, 2023 | $ | |||||||
| Net investment loss | ( | ) | ||||||
| Realized gain on investment in Bullion | ||||||||
| Change in unrealized gain on investment in Bullion | ||||||||
| Creations | ||||||||
| Redemptions | ( | ) | ( | ) | ||||
| Closing balance at December 31, 2023 | $ | |||||||
See Notes to the Financial Statements
F-7
abrdn Precious Metals Basket ETF Trust
Financial Highlights
For the years ended December 31, 2025, 2024 and 2023
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||
| Per Share Performance (for a Share outstanding throughout the entire period) | ||||||||||||
| Net asset value per Share at beginning of period | $ | $ | $ | |||||||||
| Income from investment operations: | ||||||||||||
| Net investment loss | ( | ) | ( | ) | ( | ) | ||||||
| Total realized and unrealized gains or losses on investment in Bullion | ||||||||||||
| Change in net assets from operations | ||||||||||||
| Net asset value per Share at end of period | $ | $ | $ | |||||||||
| Weighted average number of Shares | ||||||||||||
| Expense ratio | % | % | % | |||||||||
| Net investment loss ratio | ( | )% | ( | )% | ( | )% | ||||||
| Total return, net asset value | % | % | % | |||||||||
See Notes to the Financial Statements
F-8
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
| 1. | Organization |
The
abrdn Precious Metals Basket ETF Trust (the “Trust”) is a common law trust formed on October 18, 2010 under New York
law pursuant to a depositary trust agreement (the “Trust Agreement”) executed by abrdn ETFs Sponsor LLC (the “Sponsor”)
and The Bank of New York Mellon as Trustee (the “Trustee”). The Trust holds Bullion in set ratios such that for every
The investment objective of the Trust is for the Shares to reflect the performance of the prices of physical gold, silver, platinum and palladium, in the proportions held by the Trust, less the Trust’s expenses. The Shares are intended to constitute a simple and cost-effective means of making an investment similar to a proportional investment in gold, silver, platinum and palladium. An investment in physical Bullion requires expensive and sometimes complicated arrangements in connection with the assay, transportation, warehousing and insurance of the metal. Although the Shares are not the exact equivalent of an investment in Bullion, they provide investors with an alternative that allows a level of participation in the gold, silver, platinum and palladium markets through the securities market.
| 2. | Significant Accounting Policies |
The preparation of financial statements in accordance with U.S. GAAP requires those responsible for preparing financial statements to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Trust.
| 2.1. | Basis of Accounting |
The Sponsor has determined that the Trust falls within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services—Investment Companies, and has concluded that for reporting purposes, the Trust is classified as an Investment Company. The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act.
| 2.2. | Valuation of Bullion |
The Trust follows the provisions of ASC 820, Fair Value Measurement (“ASC 820”). ASC 820 provides guidance for determining fair value and requires increased disclosure regarding the inputs to valuation techniques used to measure fair value. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Effective May 23, 2024, the Trustee, at the direction of the Sponsor, entered into an Allocated Account Agreement and Unallocated Account Agreement with ICBC Standard Bank Plc (“ICBC”), providing for the custody of the Trust’s Bullion. Prior to May 23, 2024, JPMorgan Chase Bank N.A. (“JPMorgan”) served as custodian of the Trust’s Bullion. The Trust’s Bullion may also be held by a sub-custodian selected by the Custodian to hold the Trust’s Bullion on a segregated basis and whose appointment has been approved by the Sponsor. At December 31, 2024, all of the Trust’s gold, palladium and platinum was held at ICBC. At December 31, 2025, all of the Trust’s silver was held at ICBC or a sub-custodian selected by ICBC.
The Trust’s Bullion is recorded, per individual metal type, at fair value. The cost of Bullion is determined according to the average cost method and the fair value is based on the relevant “London Metal Price” for each metal held by the Trust. This is the applicable “London Bullion Market Association (“LBMA”) PM Gold Price” for the price of an ounce of gold, the “LBMA Silver Price” for silver, and for platinum and palladium the applicable LBMA Price PM. If there is no LBMA PM Gold Price, or LBMA Price PM on any day, the Trustee is authorized to use the LBMA Gold Price AM or LBMA Price AM announced on that day. If neither price is available for that day, the Trustee will value the Trust’s gold based on the most recently announced price.
F-9
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
Realized gains and losses on transfers of Bullion, or Bullion distributed for the redemption of Shares, are calculated on a trade date basis as the difference between the fair value and average cost of Bullion transferred.
The LBMA PM Gold Price is set using the afternoon session of the ICE Benchmark Administration (“IBA”) equilibrium auction, an electronic, tradable and auditable over-the-counter auction market with the ability to settle trades in US Dollars, Euros or British Pounds for LBMA authorized participating gold bullion banks or market makers that establishes a reference gold price for that day’s trading. The “London Metal Price” for gold held by the Trust is the LBMA PM Gold Price.
The IBA conducts an electronic, over-the-counter silver auction in London, England to establish a fixing price for an ounce of silver once each trading day, which is disseminated by major market vendors (the “LBMA Silver Price”). The LBMA Silver Price is established by the four LBMA authorized bullion banks and market makers participating in the auction and disseminated by major market vendors. The “London Metal Price” for silver held by the Trust is the LBMA Silver Price.
The LME is responsible for the administration of the electronic platinum and palladium bullion price fixing system (“LMEbullion”) as well as providing electronic market clearing processes for platinum and palladium bullion transactions at the fixed prices established by the LME pricing mechanism. LMEbullion establishes and publishes fixed prices for troy ounces of platinum and palladium twice each London trading day during fixing sessions beginning at 9:45 a.m. London time (the “LBMA Price AM”) and 2:00 p.m. London time (the “LBMA Price PM”). The “London Metal Price” for platinum and palladium held by the Trust is the LBMA Price PM.
Once the value of Bullion has been determined, the net asset value (the “NAV”) is computed by the Trustee by deducting all accrued fees, expenses and other liabilities of the Trust, including the remuneration due to the Sponsor (the “Sponsor’s Fee”), from the fair value of the Bullion and all other assets held by the Trust.
The Trust recognizes changes in fair value of the investment in Bullion as changes in unrealized gains or losses on investment in Bullion through the Statement of Operations.
The per Share amount of Bullion exchanged for a purchase or redemption is calculated daily by the Trustee using the London Metal Price for each metal held by the Trust to calculate the Bullion amount in respect of any liabilities for which covering Bullion sales have not yet been made, and represents the per Share amount of Bullion held by the Trust, after giving effect to its liabilities, to cover expenses and liabilities and any losses that may have occurred.
Fair Value Hierarchy
ASC 820 establishes a hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows:
– Level 1. Unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access.
– Level 2. Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments and similar data.
– Level 3. Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the Trust’s own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available.
To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3.
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
The Trust’s investment in Bullion is classified as a level 1 asset, as its value is calculated using unadjusted quoted prices from primary market sources.
The categorization of the Trust’s assets is as shown below:
(Amounts in 000’s of US$) | December 31, 2025 | December 31, 2024 | ||||||
Level 1 | ||||||||
| Investment in Bullion | $ | $ | ||||||
F-10
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
There were no transfers between levels during the years ended December 31, 2025 and 2024.
| 2.3. | Bullion Receivable and Payable |
Bullion
receivable or payable represents the quantity of Bullion covered by contractually binding orders for the creation or redemption
of Shares respectively, where the Bullion has not yet been transferred to or from the Trust’s account. Generally, ownership
of Bullion is transferred within one business day of the trade date. At December 31, 2025, the Trust had $
| 2.4. | Creations and Redemptions of Shares |
Effective June 18, 2024, the Trustee, in consultation with the Sponsor, has determined that the number of Shares comprising a Basket for the abrdn Precious Metals Basket ETF Trust shall be reduced from Shares to Shares. The Trust expects to create and redeem Shares from time to time, but only in one or more Baskets (a Basket equals a block of 25,000 Shares). The Trust issues Shares in Baskets to Authorized Participants on an ongoing basis. Individual investors cannot purchase or redeem Shares in direct transactions with the Trust. An Authorized Participant is a person who (1) is a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions; (2) is a participant in The Depository Trust Company; (3) has entered into an Authorized Participant Agreement with the Trustee and the Sponsor; and (4) has established an Authorized Participant Unallocated Account with the Trust’s Custodian or other Bullion clearing bank. An Authorized Participant Agreement is an agreement entered into by each Authorized Participant, the Sponsor and the Trustee which provides the procedures for the creation and redemption of Baskets and for the delivery of the Bullion required for such creations and redemptions. An Authorized Participant Unallocated Account is an unallocated Bullion account, established with the Custodian or a Bullion clearing bank by an Authorized Participant.
The creation and redemption of Baskets is only made in exchange for the delivery to the Trust or the distribution by the Trust of the amount of Bullion represented by the Baskets being created or redeemed, the amount of which is based on the combined NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received.
Authorized Participants may, on any business day, place an order with the Trustee to create or redeem one or more Baskets. Effective May 28, 2024, the settlement period for Shares is one business day. Prior to May 28, 2024, the standard settlement period for Shares was two business days. In the event of a trade date at period end, where a settlement is pending, a respective account receivable and/or payable will be recorded. When Bullion is exchanged in settlement of a redemption, it is considered a sale of Bullion for financial statement purposes.
The amount of Bullion represented by the Baskets created or redeemed can only be settled to the nearest 1/1000th of an ounce. As a result, the value attributed to the creation or redemption of Shares may differ from the value of Bullion to be delivered or distributed by the Trust. In order to ensure that the correct amount of Bullion is available at all times to back the Shares, the Sponsor accepts an adjustment to its Sponsor’s Fee in the event of any shortfall or excess on each transaction. For each transaction, this amount is not more than 1/1000th of an ounce of Bullion.
As the Shares of the Trust are subject to redemption at the option of Authorized Participants, the Trust has classified the outstanding Shares as Net Assets. Changes in the number of Shares outstanding are presented in the Statement of Changes in Net Assets.
| 2.5. | Income Taxes |
The Trust is classified as a “grantor trust” for U.S. federal income tax purposes. As a result, the Trust itself will not be subject to U.S. federal income tax. Instead, the Trust’s income and expenses will “flow through” to the Shareholders, and the Trustee will report the Trust’s proceeds, income, deductions, gains, and losses to the Internal Revenue Service on that basis.
The
Sponsor has evaluated whether or not there are uncertain tax positions that require financial statement recognition and has determined
that
F-11
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
| 2.6. | Investment in Bullion |
Changes in ounces of Bullion and their respective values for the years ended December 31, 2025 and 2024 are set out below:
| Year Ended December 31, 2025 | ||||||||||||||||||||
| (Amounts in 000’s of US$, except for ounces data) | ||||||||||||||||||||
| Ounces of Bullion | Gold | Palladium | Platinum | Silver | Total | |||||||||||||||
| Opening balance | ||||||||||||||||||||
| Creations | ||||||||||||||||||||
| Redemptions | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Transfers of Bullion to pay expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Closing balance | ||||||||||||||||||||
| Investment in Bullion | ||||||||||||||||||||
| Opening balance | $ | $ | $ | $ | $ | |||||||||||||||
| Creations | ||||||||||||||||||||
| Redemptions | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Realized gain / (loss) on Bullion distributed for the redemption of Shares | ( | ) | ||||||||||||||||||
| Transfers of Bullion to pay expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Realized gain / (loss) on Bullion transferred to pay expenses | ( | ) | ||||||||||||||||||
| Change in unrealized gain on investment in Bullion | ||||||||||||||||||||
| Closing balance | $ | $ | $ | $ | $ | |||||||||||||||
| Year Ended December 31, 2024 | ||||||||||||||||||||
| (Amounts in 000’s of US$, except for ounces data) | ||||||||||||||||||||
| Ounces of Bullion | Gold | Palladium | Platinum | Silver | Total | |||||||||||||||
| Opening balance | ||||||||||||||||||||
| Creations | ||||||||||||||||||||
| Redemptions | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Transfers of Bullion to pay expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Closing balance | ||||||||||||||||||||
| Investment in Bullion | ||||||||||||||||||||
| Opening balance | $ | $ | $ | $ | $ | |||||||||||||||
| Creations | ||||||||||||||||||||
| Redemptions | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Realized gain / (loss) on Bullion distributed for the redemption of Shares | ( | ) | ( | ) | ||||||||||||||||
| Transfers of Bullion to pay expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Realized gain / (loss) on Bullion transferred to pay expenses | ( | ) | ( | ) | ||||||||||||||||
| Change in unrealized gain / (loss) on investment in Bullion | ( | ) | ( | ) | ||||||||||||||||
| Closing balance | $ | $ | $ | $ | $ | |||||||||||||||
F-12
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
| 2.7. | Expenses / Realized Gains / Losses |
The primary expense of the Trust is the Sponsor’s Fee, which is paid by the Trust through in-kind transfers of Bullion to the Sponsor.
The
Trust will transfer Bullion to the Sponsor to pay the Sponsor’s Fee that accrues daily at an annualized rate equal to
The
Sponsor has agreed to assume administrative and marketing expenses incurred by the Trust, including the Trustee’s monthly
fee and out of pocket expenses, the Custodian’s fee and the reimbursement of the Custodian’s expenses, exchange listing
fees, United States Securities and Exchange Commission (the “SEC”) registration fees, printing and mailing costs,
audit fees and up to $
For
the years ended December 31, 2025, 2024 and 2023, the Sponsor’s Fee was $
At December 31, 2025 and at December 31, 2024, the fees payable to the Sponsor were $
With
respect to expenses not otherwise assumed by the Sponsor, the Trustee will, at the direction of the Sponsor or in its own discretion,
sell the Trust’s Bullion as necessary to pay these expenses. When selling Bullion to pay expenses, the Trustee will endeavor
to sell the smallest amounts of Bullion needed to pay these expenses in order to minimize the Trust’s holdings of assets
other than Bullion. Other than the Sponsor’s Fee, the Trust had
Unless otherwise directed by the Sponsor, when selling Bullion the Trustee will endeavor to sell at the price established by the London Metal Price for each metal held by the Trust. The Trustee will place orders with dealers (which may include the Custodian) through which the Trustee expects to receive the most favorable price and execution of orders. The Custodian may be the purchaser of such Bullion only if the sale transaction is made at the London Metal Price for each metal held by the Trust used by the Trustee to value the Trust’s Bullion. A gain or loss is recognized based on the difference between the selling price and the average cost of the Bullion sold. Neither the Trustee nor the Sponsor is liable for depreciation or loss incurred by reason of any sale.
Realized gains and losses result from the transfer of Bullion for Share redemptions and / or to pay expenses and are recognized on a trade date basis as the difference between the fair value and average cost of Bullion transferred.
| 2.8. | Segment Reporting |
Adoption of the new standard impacted disclosures only and did not affect the Trust’s financial position nor the results of its operations. Operating segments are components of a public entity that engage in business activities from which it may recognize revenues and incur expenses, have discrete financial information available, and have their operating results regularly reviewed by the public entity’s chief operating decision maker (“CODM”) when assessing segment performance and making decisions about segment resources. The Chief Financial Officer of the Sponsor acts as the Trust’s CODM. The CODM monitors the operating results of the Trust as a whole, and the Trust’s asset allocation is managed in accordance with its Prospectus. The Trust operates as a single operating and reporting segment pursuant to its investment objective and principal investment strategy. The Trust’s prospectus describes the Trust’s fees, investment objective, principal investment strategy and principal risks, among other items. The Trust’s portfolio composition, total returns, expense ratios and changes in net assets used by the CODM to assess segment performance and make resource allocations are consistent with the information presented within the Trust’s financial statements. The accompanying financial statements detail the Trust’s segment assets, liabilities, revenues, and expenses. Segment assets are reflected on the Trust’s Statement of Assets and Liabilities as “Total Assets” and significant segment expenses are listed on the Statement of Operations.
| 2.9. | Subsequent Events |
In accordance with the provisions set forth in FASB ASC 855-10, Subsequent Events, the Trust’s management has evaluated the possibility of subsequent events impacting the Trust’s financial statements through the filing date. During this period, no material subsequent events requiring adjustment to or disclosure in the financial statements were identified.
F-13
abrdn Precious Metals Basket ETF Trust
Notes to the Financial Statements
| 3. | Related Parties |
The Sponsor and the Trustee are considered to be related parties to the Trust. The Trustee and the Custodian and their affiliates may from time to time act as Authorized Participants and purchase or sell Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion. In addition, the Trustee and the Custodian and their affiliates may from time to time purchase or sell Bullion directly, for their own account, as agent for their customers and for accounts over which they exercise investment discretion. The Trustee’s and Custodian’s fees are paid by the Sponsor and are not separate expenses of the Trust.
| 4. | Concentration of Risk |
The Trust’s sole business activity is the investment in Bullion, and substantially all the Trust’s assets are holdings of Bullion, which creates a concentration of risk associated with fluctuations in the price of Bullion. Several factors could affect the price of Bullion, including: (i) global Bullion supply and demand, which is influenced by factors such as general changes in economic conditions, such as a recession or other economic downturn, recycling, autocatalyst demand, industrial demand, jewelry demand and investment demand, central bank purchases and sales, and production and cost levels in major Bullion-producing countries; (ii) investors’ expectations with respect to the rate of inflation; (iii) currency exchange rates; (iv) interest rates; (v) investment and trading activities of hedge funds and commodity funds; and (vi) global or regional political, economic or financial events and situations. In addition, there is no assurance that Bullion will maintain its long-term value in terms of purchasing power in the future. In the event that the price of Bullion declines, the Sponsor expects the value of an investment in the Shares to decline proportionately. Each of these events could have a material effect on the Trust’s financial position and results of operations.
| 5. | Indemnification |
Under the Trust’s organizational documents, the Trustee (and its directors, employees and agents) and the Sponsor (and its members, managers, directors, officers, employees and affiliates) are indemnified by the Trust against any liability, cost or expense it incurs without gross negligence, bad faith, willful misconduct or willful malfeasance on its part and without reckless disregard on its part of its obligations and duties under the Trust’s organizational documents. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred.
F-14
ABRDN PRECIOUS METALS BASKET ETF TRUST
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned in the capacities thereunto duly authorized.
| abrdn ETFs Sponsor LLC | ||
| Date: March 2, 2026 | /s/ Steven Dunn* | |
| Steven Dunn ** | ||
| President and Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: March 2, 2026 | /s/ Sharon Ferrari* | |
| Sharon Ferrari ** | ||
| Chief Financial Officer and Treasurer | ||
| (Principal Financial Officer and Principal Accounting Officer) |
| * | The originally executed copy of this Certification will be maintained at the Sponsor’s offices and will be made available for inspection upon request. |
| ** | The Registrant is a trust and the persons are signing in their capacities as officers of abrdn ETFs Sponsor LLC, the Sponsor of the Registrant. |
Exhibit Index
| Exhibit No. | Description | ||
| 23.1 | Consent of KPMG LLP, Independent Registered Public Accounting Firm | ||
| 31.1 | Chief Executive Officer’s Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
| 31.2 | Chief Financial Officer’s Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
| 32.1 | Chief Executive Officer’s Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
| 32.2 | Chief Financial Officer’s Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
| 101 | The following financial statements from the Trust’s Annual Report on Form 10-K for the year ended December 31, 2025, formatted in Inline XBRL: (i) Statements of Assets and Liabilities, (ii) Statements of Operations, (iii) Statements of Changes in Net Assets, and (iv) Notes to the Financial Statements. | ||
| 101.SCH | XBRL Taxonomy Extension Schema Document | ||
| 101.CAL | XBRL Taxonomy Extension Calculation Document | ||
| 101.DEF | XBRL Taxonomy Extension Definitions Document | ||
| 101.LAB | XBRL Taxonomy Extension Labels Document | ||
| 101.PRE | XBRL Taxonomy Extension Presentation Document | ||
| 104 | The cover page from the Trust’s Annual Report on Form 10-K for the year ended December 31, 2025, formatted in Inline XBRL (included as Exhibit 101). |
abrdn Precious Metals Basket ETF Trust 10-K
Exhibit 23.1
KPMG LLP
Suite 4000
1735 Market Street
Philadelphia, PA 19103-7501
Consent of Independent Registered Public Accounting Firm
We consent to the use of our reports dated March 2, 2026, with respect to the financial statements of abrdn Precious Metals Basket ETF Trust, and the effectiveness of internal control over financial reporting, incorporated herein by reference, and to the reference to our firm under the heading "Experts" in the prospectus.
Philadelphia, Pennsylvania
March 2, 2026
abrdn Precious Metals Basket ETF Trust 10-K
Exhibit 31.1
CERTIFICATION
OF CHIEF EXECUTIVE OFFICER PURSUANT
TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Steven Dunn, certify that:
1. I have reviewed this Report on Form 10-K of abrdn Precious Metals Basket ETF Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: March 2, 2026 | /s/ Steven Dunn* | |
| Steven Dunn* | ||
| President and Chief Executive Officer | ||
| (Principal Executive Officer) |
| * | The Registrant is a trust and Mr. Dunn is signing in his capacity as an officer of abrdn ETFs Sponsor LLC, the Sponsor of the Registrant. |
abrdn Precious Metals Basket ETF Trust 10-K
Exhibit 31.2
CERTIFICATION
OF CHIEF FINANCIAL OFFICER PURSUANT
TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Sharon Ferrari, certify that:
1. I have reviewed this Report on Form 10-K of abrdn Precious Metals Basket ETF Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: March 2, 2026 | /s/ Sharon Ferrari* | |
| Sharon Ferrari* | ||
| Chief Financial Officer and Treasurer | ||
| (Principal Financial Officer and Principal Accounting Officer) |
| * | The Registrant is a trust and Ms. Ferrari is signing in her capacity as an officer of abrdn ETFs Sponsor LLC, the Sponsor of the Registrant. |
abrdn Precious Metals Basket ETF Trust 10-K
Exhibit 32.1
CERTIFICATION
PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of abrdn Precious Metals Basket ETF Trust (the “Company”) on Form 10-K for the year ended December 31, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: March 2, 2026 | /s/ Steven Dunn* | |
| Steven Dunn* | ||
| President and Chief Executive Officer | ||
| (Principal Executive Officer) |
| * | The Registrant is a trust and Mr. Dunn is signing in his capacity as an officer of abrdn ETFs Sponsor LLC, the Sponsor of the Registrant. |
abrdn Precious Metals Basket ETF Trust 10-K
Exhibit 32.2
CERTIFICATION
PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of abrdn Precious Metals Basket ETF Trust (the “Company”) on Form 10-K for the year ended December 31, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date March 2, 2026 | /s/ Sharon Ferrari* | |
| Sharon Ferrari* | ||
| Chief Financial Officer and Treasurer | ||
| (Principal Financial Officer and Principal Accounting Officer) |
| * | The Registrant is a trust and Ms. Ferrari is signing in her capacity as an officer of abrdn ETFs Sponsor LLC, the Sponsor of the Registrant. |