ETF Securities replies to "spreads widen dramatically" claim

ETF Securities has replied to Gold ETF Investor's questions about spikes in the spreads (trading costs) of one of its most traded physical gold ETFs.

Figures produced by London Stock Exchange each week calculate 'time weighted' spreads. In the week ending 13 April 2012 a handful of ETF Securities products saw their spreads spike.

Those listed by Gold ETF Investor were:

PHGP: up to 1.26% from 0.14%
SGBS (ETFS Physical Swiss Gold): up to 2.41% from spreads between 0.25%-0.6%
PHSN: up to 14% up from 2.3% the week before.

ETF Securities physical metal spreads widen massively in April

click on chart to enlarge

London Stock Exchange statistics show that spreads of a popular physical gold ETF  - the ETF Securities Physical Gold £  with the LSE ticker of PHGP  - widened to 1.36% in the week between 10 April 2012 and 13 April 2012.


In the same week two other ETF Securities products also saw massive spikes in spreads. The most dramatic commodity ETF spread was ETFS Tin (PHSN) which saw its spread widen to 14.77% when it was (already quite wide) at 2.3% the week before.

Also (on the chart above) ETFS Physical Swiss Gold (SGBS) saw its spreads widen to 2.3% for the same period when they were usually between 0.25 and 0.57 in the other figures I looked at.