10-Q: GraniteShares Gold Trust Sees Strong Q1 Growth

GraniteShares Gold Trust reported a significant increase in net assets and net asset value per share for the quarter ended September 30, 2025, driven by a substantial rise in gold prices.

Summary

• Net assets increased by 16.31% from $1,105,575,430 on June 30, 2025, to $1,285,913,636 on September 30, 2025.
• Net asset value per Share rose by 16.32% from $32.42 to $37.71 during the quarter.
• The price of gold increased by 16.36% from $3,287.45 on June 30, 2025, to $3,825.3 on September 30, 2025.
• Net increase in net assets resulting from operations for the quarter was $179,439,028.
• This increase was primarily due to an unrealized gain on investment in gold bullion of $171,669,572 and a realized gain of $8,277,826 from gold sales for redemptions and sponsor fees.
• Sponsor fees for the quarter amounted to $508,370, representing 0.1749% of the Trust's average weighted net assets.
• The Trust's shares outstanding remained constant at 34,100,000 during the period.

Sentiment

Score: 8

Explanation: The Trust experienced significant positive performance driven by a strong increase in gold prices, leading to substantial growth in net assets and NAV per share. The operational aspects are stable, and controls are effective.

Positives

• Net assets increased significantly by 16.31% to $1,285,913,636.
• Net asset value per Share grew by 16.32% to $37.71.
• The underlying gold price experienced a strong appreciation of 16.36% during the quarter.
• Total return ratio at net asset value was 16.32%, and at market price was 16.61% for the quarter.

Negatives

• Net investment loss of $508,370 for the quarter, primarily due to sponsor fees.
• Net asset value per share increased slightly less than the price of gold on a percentage basis due to the impact of sponsor fees.

Risks

• The Trust's sole business activity is investment in gold bullion, making it highly susceptible to fluctuations in gold prices.
• Factors that could affect the price of gold include global gold supply and demand, investor expectations regarding inflation, currency exchange rates, interest rates, investment activities of hedge funds and commodity funds, and global or regional political, economic, or financial events.
• There is no assurance that gold will maintain its long-term value in terms of purchasing power in the future.
• A decline in the price of gold is expected to lead to a proportionate decline in the value of an investment in the Shares.

Future Outlook

The Trust's objective is for the value of its Shares to reflect the performance of the price of gold, less its expenses. The Sponsor believes the Shares offer a cost-effective investment similar to direct gold investment. The Trust is not aware of any trends, demands, commitments, events, or uncertainties likely to materially change its liquidity needs.

Management Comments

• William Rhind, CEO and CFO of GraniteShares LLC, certified that the report does not contain any untrue statement of a material fact or omit material facts, and that financial statements fairly present the financial condition and results of operations.
• Benoit Autier, Chief Accounting Officer of GraniteShares LLC, provided a similar certification regarding the accuracy and fair presentation of the financial information.
• Management concluded that the Trust's disclosure controls and procedures were effective as of the end of the reporting period.
• There has been no material change in the internal control over financial reporting during the fiscal quarter.

Industry Context

GraniteShares Gold Trust operates in the precious metals investment sector, specifically offering a passive investment vehicle designed to track the price of gold. Its performance is directly tied to global gold market dynamics, serving as an alternative to direct physical gold ownership or other gold-backed financial products. The significant appreciation in gold prices during the quarter reflects broader market trends potentially driven by inflation concerns, geopolitical uncertainties, or increased investor demand for safe-haven assets.

Comparison to Industry Standards

• The Trust's performance is directly comparable to the LBMA PM Gold Price, which it aims to track. The 16.32% increase in NAV per share closely mirrors the 16.36% increase in the LBMA PM Gold Price, indicating effective tracking performance.
• The expense ratio of 0.1749% (annualized) is competitive within the gold ETF/ETN market, which typically ranges from 0.15% to 0.60% for similar products like SPDR Gold Shares (GLD) or iShares Gold Trust (IAU).
• The Trust's structure as a grantor trust for tax purposes is a common approach for gold investment vehicles, offering flow-through tax treatment to shareholders.

Corporate Governance

Related Party Transactions

• A fee is paid to GraniteShares LLC (the Sponsor) at an annualized rate of 0.1749% of the Trust's Net Asset Value, accrued daily and paid monthly in arrears.
• The Sponsor assumes various administrative and marketing expenses, including Trustee fees, Custodian fees, exchange listing fees, SEC registration fees, printing, mailing, audit fees, and up to $100,000 per annum in legal fees.
• Affiliates of The Bank of New York Mellon (the Trustee) may act as Authorized Participants or trade gold or Shares for their own account or as agents for customers.

Stakeholder Impact

• Shareholders benefited from the significant appreciation in the value of their investment due to the rise in gold prices.
• The Sponsor receives fees for its services and assumption of administrative and marketing expenses.
• Authorized Participants facilitate the creation and redemption of shares, ensuring liquidity for the Trust.

Next Steps

• The Trust will continue its operations of issuing and redeeming Baskets in exchange for gold, tracking the performance of gold prices.
• Ongoing monitoring of disclosure controls and internal control over financial reporting will continue.

Key Dates

Recommendation

The Trust's performance is directly tied to the price of gold. Given the significant appreciation in gold prices during the quarter, the Trust effectively delivered its investment objective. For investors with a positive outlook on gold, maintaining a 'hold' position is appropriate as the Trust provides direct exposure to gold price movements, minus its competitive fees. It is not an actively managed fund, so the recommendation is based on the underlying asset's performance and the Trust's efficient tracking.

Keywords

Gold, Investment Trust, Bullion, Precious Metals, GraniteShares, BAR, NYSE Arca, SEC Filing, Quarterly Report