Do you know of anyone that has taken physical gold delivery using Comex Gold Futures,.. Instead of ETF's, where the physical is hypothetical. Futures seem an option, where a client deposits the full value of the contract plus delivery costs. The contract is rolled over before expiration to the next month in perpetuity till the gold is 'needed'. This seems a much better option, than safe deposit boxes or home vaults. Essentially you end up becoming a defacto Gold Reserve. The warehousing costs get built into the contract value. https://www.vaneck.com/blogs/etfs/taking-physical-delivery-gold-assets-september-2016/ Chris
Would need to form FCM for sole purpose of holding and rolling over gold,.. any fund/ETF/ETP, would still be associated with a specific broker and associated risks. In contrast to traditional FCM's full contract value would need to be deposited. Bonds would be the same but risks of inflation or miscalculation of inflation would destabilize valuation.
I have been, for the past 40 mins or so, trying to wrap my head around what exactly it is you are asking? This is one of the sticking points? Well, unless the contract is actually executed in expiry and the buyer takes delivery, how does the contract buyer act as a gold reserve if the contract keeps rolling into the next month of delivery?
It's actually kind of strange. You need a broker that will let you take delivery, and then believe it or not, you back your truck up to the dock at the warehouse in NYC and load up. And that's the last of the paper trail. You may need to have it assayed to sell it, depending on the buyer. But once you take delivery it's yours, and no concern of the CME. I imagine it gets more complicated if you want to put physical back on the futures mkt. CME is just not set up for that anymore. As far as I know they have no approved storage facility. There is a big outfit in London where Warren Buffet bought and stored all his silver. He said to him it was just a piece of paper.
Basically if you don't need the gold you keep rolling it over and you let the exchange handle 'warehousing' it. It's like a Fort Knox scenario but your paying the basis for others to do the job.
But there is nothing to "warehouse" if you don't physically own the gold. All you are "rolling over" is the contract itself, not the actual "underlying physical product". A future is kind of like an option in that sense, I suppose. Until the long contract expires, you don't own anything.
Oh, wait. Are you talking about an option on physical gold, as opposed to an option on a gold future? Now I'm lost. I hate options lol!
Lol .. 12,500,000 = 100 contracts (long) @ Comex = Defacto Ownership of 10,000 ounces of gold Before contract expiration offset the current contract and go long the next contract. So basically you perpetually have the right to 10,000 ounces of gold. The price differential between different months take into account storage costs.
If SHTF, happens and banks and brokerage accounts frozen, just take delivery of the gold and use it as collateral.
How much gold would you need delivered to cause a delivery cascade. Possibly well beyond position limits for specs.