FWP 1 d739050dfwp.htm DEBUNKING 5 COMMON GOLD MISCONCEPTIONS

Filed Pursuant To Rule 433

Registration No. 333-217785

April 29, 2019

Debunking 5 Common Gold Misconceptions April 2019 | By George Milling-Stanley, Head of Gold Strategy, Global SPDR ETFs and Diego Andrade, Senior Gold Research Strategist, Global SPDR ETFs Gold is attracting investor interest to The potential for possibly lowering portfolio volatility start 2019.* This isn’t surprising as with an allocation to gold is not the only reason to consider owning gold, and we’ve found there are a number of outdated investors have tended to increase their notions holding back investors from making a long-term exposure to gold when uncertainty is allocation in gold. To tackle this issue, we’ve put together a heightened and when equity returns list of what we perceive to be five common misconceptions about gold and what we believe to be the reality behind these may saw US be overstretched. gold-backed ETFs In Q4 accumulate 2018 we common misunderstandings. around $2.5 billion while the S&P Index Misconception 1: Gold’s Only Function is as an declined as much as 19.8 %.1 Inflation Hedge As we have highlighted in a number of earlier research work Reality Although gold has historically tended to perform gold may be able to perform several roles within a balanced well during periods of high and sustained inflation that has investment portfolio, including: not always been the case. The shaded areas in Figure 1 below highlight times in the early 1990s and 2000s that gold prices 1. Acting as a diversifier Gold has the potential to did not surge even though the inflation risk premium, or the play a diversifying role in a portfolio because it amount of extra yield investors require to protect against historically has not correlated strongly with other inflation, did increase. In other words, gold may play an major asset classes held in a typical portfolio.2 Gold’s important role in portfolios, but there are other drivers potential diversifying value was on full display in Q4 to its return than an increase in prices. 2018 when the S&P 500 Index declined -14.26% and the LBMA Gold Price PM (USD/oz) appreciated 7.73%. Figure 1: Inflation Risk Premium & Price of Gold Don’t 2. Reducing total portfolio risk Including a gold Always Move in Lockstep allocation within a balanced portfolio may reduce its overall volatility and improve risk-adjusted Price of Gold ($/Troy Ounce) Inflation Risk Premium (BPS) returns because gold has demonstrated a -0.01 2,000 180 and 0.06 correlation to the S&P 500 Index and Bloomberg Barclays U.S. Aggregated Bond Index, 1,500 120 respectively, since the 1970s.3 For investors who are already comfortable with a given level of risk, adding a small gold allocation may allow them to move 1,000 60 further out along the risk spectrum in some of their other investments, which may also improve risk- 500 0 adjusted returns. 3. Potential hedge against unexpected events 0 1992 1996 2000 2003 2007 2011 2015 2019 -60 Gold has a track record of at times holding its value or rising when other assets are falling — LBMA Gold Price PM (US/oz) — US Sell 5 Year & Buy 10 Year Bond Yield Spread in a differentiated manner.4 Source: Bloomberg Finance L.P. & State Street Global Advisors Research, from * Sources: Bloomberg, Company Filings, ICE Benchmark Administration, World Gold September 1, 1992 to March 31, 2019. Council; YTD Global flows into gold-backed ETFs equal $1.9 billion, date as of March 31, 2019.

Debunking 5 Common Gold Misconceptions Figure 2: Standard Performance of SPDR® Gold Shares (GLD®) as of March 31, 2019 1 Month (%) QTD (%) YTD (%) 1 Year (%) 3 Years (%) 5 Years (%) 10 Years (%) Since Inception 11/18/2004 (%) NAV -1.83 0.98 0.98 -2.54 1.15 -0.34 3.11 7.34 Market Value -1.60 0.63 0.63 -3.01 1.22 -0.26 3.05 7.22 LBMA Gold Price PM -1.80 1.28 1.28 -2.15 1.55 0.06 3.52 7.77 Gross Expense Ratio: 0.40%. Performance quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, so you may have a gain or loss when shares are sold. Current performance may be higher or lower than that quoted. Visit spdrs.com for most recent month-end. Performance returns for periods of less than one year are not annualized. Index returns are unmanaged and do not reflect the deduction of any fees or expenses. The market price used to calculate the Market Value return is the midpoint between the highest bid and the lowest offer on the exchange on which the shares of the Fund are listed for trading, as of the time that the Fund’s NAV is calculated. If you trade your shares at another time, your return may differ. Misconception 2: Gold does not Pay any Figure 3: Gold Demand By Source Interest or Produce any Income, so it has Demand (Tonnes) 2018 no Value Fabrication Reality There are many reasons investors buy gold beyond Jewellery 2,269.7 Technology 334.6 its potential value as an investment. For instance, many Sub-total above fabrication 2,604.3 people purchase gold for cultural and religious purposes. Total bar & coin demand 1,090.2 Jewelry represents the largest source of annual demand for ETFs & similar products 68.9 gold, accounting for more than 51 percent of demand for the Central bank & other inst.* 651.5 precious metal in 2018. Within gold jewelry consumption, China and India purchased more than half of the world’s Gold demand (Fabrication Basis) 4,490.2 gold jewelry last year, and while demand was overall flat in Surplus/Deficit.** 75.3 both countries last year, their historical affinity for gold has Source: World Gold Council, Gold Demand Trends Full year and Q4 2018, as of remained strong.5 So, while investment demand is important for setting the price of gold, it is actually a small portion of January 31, 2019. overall demand. This highlights how gold demand is * Excluding any delta hedging of central bank options. ** Surplus/deficit: This is the difference between total supply and gold different than traditional assets and actually may not demand. Partly a statistical residual, this number also captures demand respond to business cycle changes in the same way as in the OTC market and changes to inventories on commodity exchanges, many other commodities. with an additional contribution from changes to fabrication inventories. Misconception 3: Buying or Selling by Central Misconception 4: Gold does not Deserve an Banks is the Primary Driver of Gold Prices Allocation in a Portfolio Because it is Volatile Reality While central bank purchases and sales are an Reality Gold has historically ranked around the midrange important factor in gold prices, central bank activity has in terms of volatility when the precious metal’s price is rarely affected more than 10% of supply or demand numbers. compared with various stock and bond indices.* (See Figure From 1989 to 2009, central bankers were net sellers to the 4). Moreover, if one considers that indices tend to be less private sector of about 10% of the annual gold supply; since volatile than their individual stock or bond components, 2010, central banks have been net purchasers of about 10% gold’s potential volatility may be less of a concern. In other of annual demand. In 2018, central banks annual demand words, claiming that gold might be overly volatile relative to increased to 15% which was the highest level in 50 years. other investments may be misguided. Meanwhile, jewelry regularly accounts for around 50% or * Indices representing gold, stocks and bonds in the above comparison are as follows: more of end-user demand and the use of gold in industrial Gold = LBMA Gold Price PM (USD/oz); Equities = MSCI EAFE Index, MSCI EAFE and technological applications accounts for up to another Index; Bonds = Bloomberg Barclays US Treasury Index, Bloomberg Barclays US 10%. Investment demand has historically ranged from Corporate High Yield Index, Bloomberg Barclays Global Treasury Ex-US Index. roughly 10% to 30% annually. State Street Global Advisors 2

Debunking 5 Common Gold Misconceptions Figure 4: Gold’s Volatility Historically Tends to be Lower Figure 5: Gold’s Return has been Higher Under Low and than Certain Equities Moderate Real Rate Regimes* Bloomberg Barclays US Treasury Index 3.5 $/oz % 1,400 2 Bloomberg Barclays Global 7.4 Treasury Ex-US Index 1,300 1 Bloomberg Barclays US 6.5 Corporate High Yield Index Bloomberg Commodity Index 14.4 1,200 0 MSCI EAFE Index 15.2 1,100 -1 LBMA Gold Price PM (USD/oz) 17.2 MSCI Emerging Markets Index 18.0 -2 1,000 2015 2016 2017 2018 2019 Dow Jones US Select REIT Index 16.5 — Gold Spot Price ($/oz) — Real Rates 0 5 10 15 20 25 Volatility Source: Bloomberg Finance, L.P., State Street Global Advisors, as of Source: Bloomberg Finance L.P., State Street Global Advisors, date as of March 31, 2019. December 31, 2008 to March 31, 2019 reflect annualized monthly averages Past performance is not a guarantee of future results. Performance for 120 months. Past performance is no guarantee of future results. above does not reflect charges and expenses associated with the fund or brokerage commissions associated with buying and selling exchange Misconception 5: A Tightening Cycle Leads to traded funds. Performance above is not meant to represent the performance of any investment product. Negative Gold Prices * Gold Price represented by LBMA Gold Price; Real Rates represented by Reality The traditional view is that when the Federal 10-year Treasury note yield minus US core Consumer Price Index (excluding Reserve (Fed) starts raising rates the economy is growing food and energy). and countering inflation is becoming a concern. Interest rates and inflation are often linked together due to their Today we are in a different macro environment than we impact on real rates, which has historically affected gold were in the 1970s and 1980s. As Figure 5 shows, at the start prices. There may be short-term noise, but interest rate of the current tightening cycle, real rates and gold were at hikes are not necessarily negative for gold. The ten interest 0.13% and $1,049.40, respectively. After nine rate hikes both rate tightening cycles we analyzed since 1971, when gold have increased to 0.37% and $1,295.40, respectively (as of effectively became free-floating, had resulted in an average March 31, 2019). Other variables that drive the price of gold increase of 37% in the price of gold.6 In line with prior have helped the price appreciate as real rates increased, but tightening cycles, gold was up 23.4% (as of March 31, 2019) we believe the most important thing investors need to keep from the price level we saw in December 17, 2015, when in mind is that all tightening cycles behave differently and the current interest rate tightening cycle began. real interest rates remain at levels that have historically Throughout the 1970s, inflation was a huge concern that benefited gold prices. forced the Fed to raise rates aggressively in early 1980, The Takeaway for Investors which helped real rates stretch to 9% and average 4.50% for the entire decade.7 Those rates along with other variables Today’s uncertain market environment may be the that affect the gold price played a key role in gold’s poor ideal time for investors to rethink any of these common performance during the 1980s. However, we believe the misconceptions about gold and the potential role gold long-term trend of real rates is currently in gold’s favor. can play in an investment portfolio. State Street Global Advisors 3

Debunking 5 Common Gold Misconceptions 1 Source: Bloomberg Financial L.P. and State Street Global Advisors, date as of Glossary December 31, 2018. Bloomberg Barclays Global Treasury ex-U.S. Index A benchmark designed to 2 Since 2000, the correlation of gold to stocks, bonds and other commodities was track the fixed-rate local currency sovereign debt issued by investment-grade -0.01, 0.28, and 0.44, respectively. Source: Bloomberg Financial L.P. & State Street countries outside the US. Bonds must have a remaining maturity of one year or more. Global Advisors, date as of 3/31/2019. Computed using monthly return data from Bloomberg Barclays U.S. Corporate High Yield Bond Index The Barclays U.S. January 2000 to March 31, 2019. Correlation measures the degree to which the High Yield Index covers the universe of fixed rate, non-investment grade debt. deviations of one variable from its mean are related to those of a different variable Eurobonds and debt issues from countries designated as emerging markets (sovereign from its respective mean. Stocks represented by S&P 500 Index; Bonds represented rating of Baa1/BBB+/BBB+ and below using the middle of Moody’s, S&P, and Fitch) by the Bloomberg Barclays U.S. Aggregate Index; Commodities represented by are excluded, but Canadian and global bonds (SEC registered) of issuers in non-EMG Bloomberg Commodity Index. Index returns reflect all items of income, gain and loss countries are included. The index includes both corporate and non-corporate sectors. and the reinvestment of dividends and other income. 3 Bloomberg Barclays U.S. Aggregate Bond Index A benchmark that provides a Bloomberg Finance L.P. & State Street Global Advisors; S&P 500 monthly measure of the performance of the US dollar denominated investment grade bond correlation is from 8/31/1971 to 3/31/2019 and Bloomberg Barclays U.S. market, which includes investment grade government bonds, investment grade Aggregate Bond Index monthly correlation is from 3/31/1976 to 3/31/2019. 4 corporate bonds, mortgage pass through securities, commercial mortgage backed Source: Bloomberg Finance L.P., State Street Global Advisors, as of December 31, securities and asset backed securities that are publicly for sale in the US. 2018. Notes: Dot-Com Meltdown: 2/29/2000–3/30/2001 LBMA Gold Price PM Bloomberg Barclays U.S. Treasury Index US dollar-denominated, fixed-rate, (USD/oz) returned -12.2%, MSCI AC World TR returned -20.6% and Bloomberg nominal debt issued by the US Treasury. Treasury bills are excluded by the maturity Barclays US Aggregated Bond Index TR returned 14.0% ; September 11 Terrorist constraint, but are part of a separate Short Treasury Index. Attacks: 8/31/2001–9/28/2001 LBMA Gold Price PM (USD/oz) returned 7.4%, MSCI AC World TR returned -9.1% and Bloomberg Barclays US Aggregated Bond Index TR Bloomberg Commodity Index A broadly diversified commodity price returned 1.2%; 2002 Recession: 2/28/2002–8/30/2002 LBMA Gold Price PM index distributed by Bloomberg Indexes that tracks 22 commodity futures and (USD/oz) returned 5.4%, MSCI AC World TR returned -12.2% and Bloomberg seven sectors. No one commodity can compose less than 2 percent or more Barclays US Aggregated Bond Index TR returned 4.9%; Global Financial Crisis: than 15 percent of the index, and no sector can represent more than 33 percent 11/30/2007–3/31/2009 LBMA Gold Price PM (USD/oz) returned 17.0%, MSCI AC of the index. World TR returned -48.6% and Bloomberg Barclays US Aggregated Bond Index TR Consumer Prices (CPI) Consumer Prices (CPI) are a measure of prices paid returned 5.7%; Sovereign Debt Crisis I: 4/30/2010–8/31/2010 LBMA Gold Price PM by consumers for a market basket of consumer goods and services. The yearly (USD/oz) returned 5.7%, MSCI AC World TR returned -8.3% and Bloomberg (or monthly) growth rates represent the inflation rate. Barclays US Aggregated Bond Index TR returned 4.8%; Sovereign Debt Crisis II: Dow Jones U.S. Select REIT Index A benchmark of US REITs and REIT-like 2/28/2011–10/31/2011 LBMA Gold Price PM (USD/oz) returned 22.0%, MSCI securities that screens for market capitalization, liquidity and percentage of revenue AC World TR returned -8.1% and Bloomberg Barclays US Aggregated Bond Index derived from ownership and operation of real estate securities. It is float market cap TR returned 6.4%; Brexit: 6/22/2016–6/27/2016 LBMA Gold Price PM (USD/ weighted and quoted in dollars. oz) returned 4.7%, MSCI AC World TR returned -5.6% and Bloomberg Barclays US Aggregated Bond Index TR returned 0.91%. Past performance is not a LBMA Gold Price The LBMA Gold Price is determined twice each business day guarantee of future results. Performance above does not reflect charges (10:30 a.m. and 3:00 p.m. London time) by the participants in a physically settled, and expenses associated with the fund or brokerage commissions electronic and tradable auction administered by the IBA using a bidding process associated with buying and selling exchange traded funds. Performance that determines the price of gold by matching buy and sell orders submitted by the above is not meant to represent the performance of any investment participants for the applicable auction time. product. Performance data above derived from total return indices. MSCI EAFE Index An equities benchmark that captures large- and mid-cap 5 World Gold Council, “Gold Demand Trends Full Year 2018,” published 1/31/2019. representation across developed market countries around the world, excluding 6 Source: Bloomberg Financial L.P. & State Street Global Advisors, the US and Canada. as of December 31, 2018. MSCI Emerging Markets Index The MSCI Emerging Markets Index captures 7 Source: Bloomberg Financial L.P. & State Street Global Advisors, large and mid-cap representation across 23 emerging markets countries. With 834 as of Date December 31, 2018. constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country. Learn More Standard Deviation Measures the historical dispersion of a security, fund or index For more information, please visit spdrs.com/gld. around an average. Investors use standard deviation to measure expected risk or volatility, and a higher standard deviation means the security has tended to show higher volatility or price swings in the past. State Street Global Advisors 4

Debunking 5 Common Gold Misconceptions ssga.com | spdrs.com Important risk information Act of 1936 (the “CEA”). As a result, shareholders of the Trust do not have the The views expressed in this material are the views of George Milling-Stanley and protections associated with ownership of shares in an investment company registered Diego Andrade through 03/31/2019 and are subject to change based on the market under the 1940 Act or the protections afforded by the CEA. and other conditions. GLD shares trade like stocks, are subject to investment risk and will fluctuate in Investing involves risk, and you could lose money on an investment in SPDR® Gold market value. The value of GLD shares relates directly to the value of the gold held Trust (“GLD®”). by GLD (less its expenses), and fluctuations in the price of gold could materially and adversely affect an investment in the shares. The price received upon the sale of the ETFs trade like stocks, are subject to investment risk, fluctuate in market value and shares, which trade at market price, may be more or less than the value of the gold may trade at prices above or below the ETFs’ net asset value. Brokerage commissions represented by them. GLD does not generate any income, and as GLD regularly sells and ETF expenses will reduce returns. gold to pay for its ongoing expenses, the amount of gold represented by each Share Commodities and commodity-index linked securities may be affected by changes in will decline over time to that extent. overall market movements, changes in interest rates, and other factors such as The World Gold Council name and logo are a registered trademark and used with the weather, disease, embargoes, or political and regulatory developments, as well as permission of the World Gold Council pursuant to a license agreement. The World Gold trading activity of speculators and arbitrageurs in the underlying commodities. Council is not responsible for the content of, and is not liable for the use of or reliance Frequent trading of ETFs could significantly increase commissions and other costs such on, this material. World Gold Council is an affiliate of GLD’s sponsor. that they may offset any savings from low fees or costs. ® GLD is a registered trademark of World Gold Trust Services, LLC used with the Diversification does not ensure a profit or guarantee against loss. permission of World Gold Trust Services, LLC. Investing in commodities entails significant risk and is not appropriate for Standard & Poor’s®, S&P® and SPDR® are registered trademarks of Standard & Poor’s all investors. Financial Services LLC, a division of S&P Global (S&P); Dow Jones is a registered Important Information Relating to SPDR® Gold Trust (“GLD®”): trademark of Dow Jones Trademark Holdings LLC (Dow Jones); and these trademarks have been licensed for use by S&P Dow Jones Indices LLC (SPDJI) and sublicensed The SPDR Gold Trust (“GLD”) has filed a registration statement (including a for certain purposes by State Street Corporation. State Street Corporation’s financial prospectus) with the Securities and Exchange Commission (“SEC”) for the products are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, offering to which this communication relates. Before you invest, you should their respective affiliates and third party licensors and none of such parties makes any read the prospectus in that registration statement and other documents GLD representation regarding the advisability of investing in such product(s) nor do they has filed with the SEC for more complete information about GLD and this have any liability in relation thereto. offering. Please see the GLD prospectus for more detailed discussion of the risks of investing in GLD shares. The GLD prospectus is available by clicking For more information, please contact the Marketing Agent for GLD: State here. You may get these documents for free by visiting EDGAR on the SEC Street Global Advisors Funds Distributors, LLC, One Iron Street, Boston, MA, website at sec.gov or by visiting spdrgoldshares.com. Alternatively, the 02210; T: +1 866 320 4053 spdrgoldshares.com. Trust or any authorized participant will arrange to send you the prospectus if © 2019 State Street Corporation. All Rights Reserved. you request it by calling 866.320.4053. State Street Global Advisors Funds Distributors, LLC, One Iron Street, Boston, GLD is not an investment company registered under the Investment Company Act of MA 02210. 1940 (the “1940 Act”) and is not subject to regulation under the Commodity Exchange © 2019 State Street Corporation. All Rights Reserved. State Street Global Advisors Ad is ID16349-2028663.6.1.AM.RTL 0419 Exp. Date: 07/31/2019 5

SPDR® GOLD TRUST has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the Trust and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the Trust or any Authorized Participant will arrange to send you the prospectus if you request it by calling toll free at 1-866-320-4053 or contacting State Street Global Advisors Funds Distributors, LLC, One Lincoln Street, Attn: SPDR® Gold Shares, 30th Floor, Boston, MA 02111.