Global X on Tuesday (3/15/11) rolled out a new ETF designed to target companies producing gold and only gold. Global X Pure Gold Miners ETF (GGGG) seeks to track an index that limits inclusion to companies that generate the vast majority of their business from gold mining.
The underlying Solactive Global Pure Gold Miners Index restricts new index components to those with at least 95% of the company’s revenues generated from gold mining. To remain in the index, that proportion must remain above 90%. Additionally, constituents are weighted proportionally on free float market capitalization with the largest positions capped at 4.75% each.
The resulting country breakdown for the fund currently has Canada at 41.3%, South Africa 15.4%, U.S. 11.2%, Australia 9.1%, U.K. 6.4%, Jersey 4.8%, Russia 4.8%, China 4.1%, and Turkey 3.0%.
GGGG has an expense ratio of 0.59%, and the fund has 30 holdings in all. The nine stocks capped at 4.75% during the last index rebalancing were Kinross Gold Corp (KGC), Anglogold Ashanti ADR (AU), Gold Fields Ltd ADR (GFI), Polyus Gold ADR (OPYGY), Eldorado Gold Corp (EGO), Randgold Resources Ltd-ADR (GOLD), Osisko Mining Corp (OSKFF), Petropavlovsk Plc, and Centerra Gold Inc.
GGGG will be in competition with both Market Vectors Gold Miners (GDX) and Market Vectors Junior Gold Miners (GDXJ), as GGGG’s holdings are found in both. However, due to its “pure” play philosophy, GGGG excludes many familiar names that don’t meet that description including Barrick Gold (ABX), Newmont Mining (NEM), Buenaventura Mining Company (BVN), and Yamana Gold (AUY).
Disclosure covering writer, editor, and publisher: No positions in any of the securities mentioned. No positions in any of the companies or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.