
[Federal Register Volume 82, Number 74 (Wednesday, April 19, 2017)]
[Notices]
[Pages 18492-18502]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-07877]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80457; File No. SR-NYSEArca-2017-33]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
of Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To 
List and Trade Shares of the Euro Gold Trust, Pound Gold Trust, and the 
Yen Gold Trust Under NYSE Arca Equities Rule 8.201

April 13, 2017.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on March 31, 2017, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the self-regulatory 
organization. On April 12, 2017, the Exchange filed Amendment No. 1 to 
the proposal, which amended and replaced the proposed rule change in 
its entirety. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as modified by Amendment No. 1, 
from interested persons.
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the Euro Gold 
Trust, Pound Gold Trust, and the Yen Gold Trust under NYSE Arca 
Equities Rule 8.201. The proposed change is available on the Exchange's 
Web site at www.nyse.com, at the principal office of the Exchange, and 
at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to list and trade shares (``Shares'') of the 
Euro Gold Trust, Pound Gold Trust, and the Yen Gold Trust (each a 
``Fund'' and, collectively, the ``Funds''), which are series of the 
World Currency Gold Trust (``Trust''), under NYSE Arca Equities Rule 
8.201.\4\ Under NYSE Arca Equities Rule 8.201, the Exchange may propose 
to list and/or trade pursuant to unlisted trading privileges (``UTP'') 
``Commodity-Based Trust Shares.'' \5\
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    \4\ On March 30, 2017, the Trust filed with the Commission its 
initial registration statement on Form S-1 under the Securities Act 
of 1933 (``1933 Act'') relating to the Funds (File No. 333-217041) 
(``Registration Statement''). The description of the operation of 
the Trust and the Funds herein is based, in part, on the 
Registration Statement.
    \5\ Commodity-Based Trust Shares are securities issued by a 
trust that represent investors' discrete identifiable and undivided 
beneficial ownership interest in the commodities deposited into the 
Trust.
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    The Funds will not be registered investment companies under the 
Investment Company Act of 1940 \6\ and are not required to register 
under such act.
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    \6\ 15 U.S.C. 80a-1.
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    The Sponsor of the Funds and the Trust will be WGC USA Asset

[[Page 18493]]

Management Company, LLC (the ``Sponsor'').\7\ BNY Mellon Asset 
Servicing, a division of The Bank of New York Mellon (``BNYM''), will 
be the Funds' administrator (``Administrator'') and transfer agent 
(``Transfer Agent'') and will not be affiliated with the Trust, the 
Funds or the Sponsor. BNYM will also serve as the custodian of the 
Funds' cash, if any. HSBC Bank plc will be the custodian (the 
``Custodian'') of the Funds' gold.
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    \7\ The Trust will be a Delaware statutory trust consisting of 
multiple series, each of which will issue common units of beneficial 
interest, which represent units of fractional undivided beneficial 
interest in and ownership of such series. The term of the Trust and 
each series will be perpetual (unless terminated earlier in certain 
circumstances). The sole trustee of the Trust will be Delaware Trust 
Company (``Trustee'').
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    The Commission has previously approved listing on the Exchange 
under NYSE Arca Equities Rules 5.2(j)(5) and 8.201 of other precious 
metals and gold-based commodity trusts, including the Merk Gold Trust; 
\8\ ETFS Gold Trust,\9\ ETFS Platinum Trust \10\ and ETFS Palladium 
Trust (collectively, the ``ETFS Trusts''); \11\APMEX Physical-1 oz. 
Gold Redeemable Trust; \12\ Sprott Gold Trust; \13\ SPDR Gold Trust 
(formerly, streetTRACKS Gold Trust); iShares Silver Trust; \14\ iShares 
COMEX Gold Trust; \15\ and Long Dollar Gold Trust.\16\ Prior to their 
listing on the Exchange, the Commission approved listing of the 
streetTRACKS Gold Trust on the New York Stock Exchange (``NYSE'') \17\ 
and listing of iShares COMEX Gold Trust and iShares Silver Trust on the 
American Stock Exchange LLC.\18\ In addition, the Commission has 
approved trading of the streetTRACKS Gold Trust and iShares Silver 
Trust on the Exchange pursuant to UTP.\19\
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    \8\ Securities Exchange Act Release No. 71378 (January 23, 
2014), 79 FR 4786 (January 29, 2014) (SR-NYSEArca-2013-137).
    \9\ Securities Exchange Act Release No. 59895 (May 8, 2009), 74 
FR 22993 (May 15, 2009) (SR-NYSEArca-2009-40).
    \10\ Securities Exchange Act Release No. 61219 (December 22, 
2009), 74 FR 68886 (December 29, 2009) (SR-NYSEArca-2009-95).
    \11\ Securities Exchange Act Release No. 61220 (December 22, 
2009), 74 FR 68895 (December 29, 2009) (SR-NYSEArca-2009-94).
    \12\ Securities Exchange Act Release No. 66930 (May 7, 2012), 77 
FR 27817 (May 11, 2012) (SR-NYSEArca-2012-18).
    \13\ Securities Exchange Act Release No. 61496 (February 4, 
2010), 75 FR 6758 (February 10, 2010) (SR-NYSEArca-2009-113).
    \14\ See Securities Exchange Act Release No. 58956 (November 14, 
2008), 73 FR 71074 (November 24, 2008) (SR-NYSEArca-2008-124) 
(approving listing on the Exchange of the iShares Silver Trust).
    \15\ See Securities Exchange Act Release No. 56224 (August 8, 
2007), 72 FR 45850 (August 15, 2007) (SR-NYSEArca-2007-76) 
(approving listing on the Exchange of the streetTRACKS Gold Trust); 
Securities Exchange Act Release No. 56041 (July 11, 2007), 72 FR 
39114 (July 17, 2007) (SR-NYSEArca-2007-43) (order approving listing 
on the Exchange of iShares COMEX Gold Trust).
    \16\ See Securities Exchange Act Release No. 79518 (December 9, 
2016), 81 FR 90876 (December 15, 2016) (SR-NYSEArca-2016-84) (order 
approving listing and trading of shares of the Long Dollar Gold 
Trust).
    \17\ See Securities Exchange Act Release No. 50603 (October 28, 
2004), 69 FR 64614 (November 5, 2004) (SR-NYSE-2004-22) (order 
approving listing of streetTRACKS Gold Trust on NYSE).
    \18\ See Securities Exchange Act Release Nos. 51058 (January 19, 
2005), 70 FR 3749 (January 26, 2005) (SR-Amex-2004-38) (order 
approving listing of iShares COMEX Gold Trust on the American Stock 
Exchange LLC); 53521 (March 20, 2006), 71 FR 14967 (March 24, 2006) 
(SR-Amex-2005-72) (approving listing on the American Stock Exchange 
LLC of the iShares Silver Trust).
    \19\ See Securities Exchange Act Release Nos. 53520 (March 20, 
2006), 71 FR 14977 (March 24, 2006) (SR-PCX-2005-117) (approving 
trading on the Exchange pursuant to UTP of the iShares Silver 
Trust); 51245 (February 23, 2005), 70 FR 10731 (March 4, 2005) (SR-
PCX-2004-117) (approving trading on the Exchange of the streetTRACKS 
Gold Trust pursuant to UTP).
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    The Euro Gold Trust will be designed to track the performance of 
the Solactive GLD[supreg] EUR Gold Index, less the expenses of the 
Fund's operations. The Solactive GLD[supreg] EUR Gold Index seeks to 
track the daily performance of a long position in physical gold (as 
represented by the ``Gold Price'', as defined below) and a short 
position in the Euro (i.e., a long U.S. dollar (``USD'') exposure 
versus the Euro).
    The Pound Gold Trust will be designed to track the performance of 
the Solactive GLD[supreg] GBP Gold Index, less the expenses of the 
Fund's operations. The Solactive GLD[supreg] GBP Gold Index seeks to 
track the daily performance of a long position in physical gold (as 
represented by the Gold Price) and a short position in the British 
Pound Sterling (i.e., a long USD exposure versus the British Pound 
Sterling).
    The Yen Gold Trust will be designed to track the performance of the 
Solactive GLD[supreg] JPY Gold Index, less the expenses of the Fund's 
operations. The Solactive GLD[supreg] JPY Gold Index seeks to track the 
daily performance of a long position in physical gold (as represented 
by the Gold Price) and a short position in the Japanese Yen (i.e., a 
long USD exposure versus the Japanese Yen). The Japanese Yen, the Euro 
and the British Pound Sterling are referred to collectively herein as 
the ``Reference Currencies''. Each of the Solactive GLD[supreg] EUR 
Gold Index, Solactive GLD[supreg] GBP Gold Index, and Solactive 
GLD[supreg] JPY Gold Index are referred to herein as an ``Index'' and, 
collectively, as the ``Indexes''.
Operation of the Funds
    According to the Registration Statement, each Fund will be a 
passive investment vehicle and will be designed to track the 
performance of its Index regardless of: (i) The price of gold or the 
corresponding Reference Currency; (ii) market conditions; and (iii) 
whether the Index is increasing or decreasing in value. Each Fund's 
holdings generally will consist entirely of ``Gold Bullion''.\20\ 
Substantially all of the Funds' Gold Bullion holdings are delivered by 
``Authorized Participants'' (as described below) in exchange for Fund 
Shares. The Funds will not hold their respective Reference Currencies. 
The Funds generally will not hold USDs (except from time to time in 
very limited amounts to pay Fund expenses). The Funds' Gold Bullion 
holdings are not managed and the Funds do not have any investment 
discretion.
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    \20\ Gold Bullion means (a) gold meeting the requirements of 
``London Good Delivery Standards'' or (b) credit to an ``Unallocated 
Account'' representing the right to receive Gold Bullion meeting the 
requirements of London Good Delivery Standards. London Good Delivery 
Standards are the specifications for weight dimensions, fineness (or 
purity), identifying marks and appearance set forth in ``The Good 
Delivery Rules for Gold and Silver Bars'' published by the London 
Bullion Markets Association (``LBMA'').
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    Each Fund's net asset value (``NAV'') will go up or down each 
Business Day \21\ based primarily on two factors. The first is the 
change in the price of gold measured in USDs from the prior Business 
Day. This drives the value of the Fund's Gold Bullion holdings measured 
in USDs up (as gold prices increase) or down (as gold prices fall). The 
second is the change in the value of the Fund's corresponding Reference 
Currency against the USD from the prior Business Day. This drives the 
value of the Fund's Gold Bullion holdings measured in the Reference 
Currency up (when the value of the USD against the Reference Currency 
increases) or down (when the value of the USD against the Reference 
Currency declines). The value of gold and the Reference Currencies are 
based on publicly available, transparent prices--for gold, the LBMA 
Gold Price AM; for currencies, the WMR Fix.\22\
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    \21\ A Business Day with respect to the Funds is any day the 
Exchange is open for business.
    \22\ The WMR Fix is the World Markets Company plc foreign 
exchange benchmark rate.
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    Because each Fund generally holds only Gold Bullion (and not USDs 
or its Reference Currency), the actual economic impact of changes in 
the value of the Fund's Reference Currency against the USD from day to 
day can be reflected in the Fund only by moving an amount of Gold 
Bullion ounces of equivalent value into or out of the Fund on a daily 
basis. Therefore, each Fund will seek to track the performance of its 
Index by entering into a daily

[[Page 18494]]

transaction with the ``Gold Delivery Provider'' as described herein.
    As with the Indexes, Fund Shares are intended to increase in value 
when the price of the Gold Bullion held by a Fund increases (as 
measured by the Gold Price) and/or when the price of the USD increases 
against the value of the Fund's corresponding Reference Currency. Fund 
Shares are intended to decrease in value when the price of the Gold 
Bullion held by a Fund decreases (as measured by the Gold Price) and/or 
when the price of the USD declines against the value of the Fund's 
corresponding Reference Currency. The net impact of these changes 
determines the value of each Fund on a daily basis. Although investors 
will purchase Shares of the Funds in USD, each Fund is designed to 
provide investors with the economic effect of holding gold in terms of 
the Fund's corresponding Reference Currency, rather than the USD.
Description of the Indexes
    Each Index is maintained and calculated by Solactive AG, the Index 
Provider. The description of the strategy and methodology underlying 
each Index is based on rules published by the Index Provider (the 
``Index Rules'').
    Each Index is described as a ``notional'' or ``synthetic'' 
portfolio or strategy because there is no actual portfolio of assets to 
which any person is entitled or in which any person has any ownership 
interest. Each Index references certain assets (i.e., gold and one of 
the Reference Currencies), the performance of which will be used as a 
reference point for calculating the daily performance of the Index 
(each, an ``Index Level''). Each Index seeks to track the daily 
performance of a long position in physical gold and a short position in 
its corresponding Reference Currency relative to USDs (i.e., a long USD 
exposure versus the corresponding Reference Currency). If the Gold 
Price (as defined below) increases and the corresponding Reference 
Currency depreciates against the USD, each Index Level is intended to 
increase. Conversely, if the Gold Price decreases and the corresponding 
Reference Currency appreciates against the USD, each Index Level is 
intended to decrease. In certain cases, the appreciation of the Gold 
Price or the depreciation of a Reference Currency may be offset by the 
appreciation of such Reference Currency or the depreciation of the Gold 
Price, as applicable. The net impact of these changes determines each 
Index Level on a daily basis.
    Rather than viewing an Index in terms of percentage weightings of 
gold and the corresponding Reference Currency, it is more accurate to 
view the Index as being weighted 100% in gold with an overlay of the 
Reference Currency that essentially reflects how the gold is performing 
in terms of the Reference Currency. Just as the gold price in terms of 
U.S. dollars is not weighted partially in gold and partially in U.S. 
dollars, an Index is not weighted partially in gold and partially in 
the corresponding Reference Currency.
    According to the Registration Statement, the daily price of gold 
generally is the primary driver of Index returns. Fluctuations in the 
value of each Reference Currency has historically typically accounted 
for less than 1% of the daily returns of the corresponding Index. Each 
Index values gold on a daily basis using the ``Gold Price.'' The Gold 
Price generally is the LBMA Gold Price AM. The ``LBMA Gold Price'' 
means the price per troy ounce of gold stated in USDs as set via an 
electronic auction process run twice daily at 10:30 a.m. and 3:00 p.m. 
London time each Business Day as calculated and administered by the ICE 
Benchmark Administration Limited (``IBA'') and published by the LBMA on 
its Web site. The ``LBMA Gold Price AM'' is the 10:30 a.m. LBMA Gold 
Price. IBA, an independent specialist benchmark administrator, provides 
the price platform, methodology and the overall administration and 
governance for the LBMA Gold Price.
    According to the Registration Statement, each Index reflects the 
price of Gold in U.S. dollars adjusted by the price of its 
corresponding Reference Currency (as specified above) against the U.S. 
dollar. Each Index is designed to measure daily Gold Bullion returns as 
though an investor had invested in Gold Bullion in terms of the 
Reference Currency reflected in that Index. In general, each Index is 
intended to increase in value when the price of gold (as measured by 
the Gold Price) increases and/or when the value of the USD increases 
against the value of the corresponding Reference Currency. In general, 
each Index is intended to decrease in value when the price of gold (as 
measured by the Gold Price) decreases and/or when the value of the USD 
declines against the value of the corresponding Reference Currency. The 
net impact of these changes determines the value of each Index on a 
daily basis. Each Fund's Index is maintained and calculated by the 
Index Provider.
    According to the Registration Statement, the daily price of gold in 
USD generally is the primary driver of Index returns. Historically, 
fluctuations in the price of each Reference Currency have accounted for 
only a small portion of Index returns. Each Index is not designed to 
reflect the price of spot trades in its corresponding Reference 
Currency (which per market convention assume delivery of the Reference 
Currency). Rather, each Index assumes that positions in its 
corresponding Reference Currency are rolled forward and not physically 
settled. The Index does this by approximating what would occur if spot-
next trades were entered into on each ``Index Business Day'' and closed 
out on the next Index Business Day against spot transactions.\23\ Each 
Index approximates the cost of entering into a spot-next trade by 
linearly interpolating the cost of that trade based on the WM/Reuters 
(``WMR'') ``SW--Spot Week (One Week)'' forward rates and a spot 
transaction.\24\ The ``Spot Next Forward Points'' adjust the spot price 
to reflect the cost of rolling Reference Currency positions.
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    \23\ An Index Business Day is (i) any day that is a business day 
in New York and London, (ii) any day (other than a Saturday or 
Sunday) on which the LBMA is scheduled to publish the LBMA Gold 
Price AM, and (iii) any day (other than a Saturday or Sunday) on 
which WM Company is scheduled to publish prices for each Reference 
Currency pair.
    \24\ WMR provides both intraday and closing fixes for currency 
spot rates, forward contracts and non-deliverable forward contracts. 
WMR rates are widely utilized by financial institutions in 
evaluating global markets. Thomson Reuters Benchmark Services 
Limited, the administrator of the WM/Reuters spot, forward and non-
deliverable foreign exchange benchmark rates, has stated that it 
complies with the International Organization of Securities 
Commissions (IOSCO) Principles for Financial Benchmarks. See http://financial.thomsonreuters.com/content/dam/openweb/documents/pdf/financial/wm-reuters-iosco-principles-statement.pdf.
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Valuation of the Reference Currency in an Index
    Each Reference Currency is expressed in the corresponding Index in 
terms of a number of foreign currency units relative to one USD (e.g., 
a number of Japanese Yen per one USD) or in terms of a number of USDs 
per one unit of the reference currency (e.g., a number of USDs per one 
Euro). In order to reflect currency returns and for purposes of 
calculating each Index, each Index references the Spot Rate and Spot 
Next Forward Points associated with its Reference Currency.
    A ``Spot Rate'' is the rate at which a Reference Currency can be 
exchanged for USDs on an immediate basis, subject to the applicable 
settlement cycle. In other words, if an investor wanted to convert USDs 
into Euros, the investor could enter into a spot transaction at the 
Spot Rate (subject to the bid/ask) and would receive Euros in a number 
of days, depending on the settlement cycle of that currency. Generally, 
the

[[Page 18495]]

settlement of a ``spot'' transaction is two currency business days. The 
following table sets forth the Reference Currencies (each of which is 
measured against USDs), the applicable Reuters Page for each Spot Rate 
referenced by the applicable Index and the market convention for 
quoting such currency.

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         Reference currency                   Reuters page                 Market convention for quotation
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EUR/USD.............................  USDEURFIX=WM................  Number of USD per one EUR.
USD/JPY.............................  USDJPYFIX=WM................  Number of JPY per one USD.
GBP/USD.............................  USDGBPFIX=WM................  Number of USD per one GBP.
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    Each Index generally references the Spot Rate for its Reference 
Currency as of 9:00 a.m. London time, but may use different fixing 
times for certain reasons as described in the Index Rules.
    According to the Registration Statement, the World Markets Company 
plc (``WM'') provides an exchange rate service that publishes Spot 
Rates at fixed times throughout the global trading day.\25\ WM does not 
use a panel or polling solicitation process to obtain underlying data 
in the benchmark calculation process. WM uses transactional data to set 
``Trade Rates,'' reflecting data from actual transactions entered into 
on an arm's length basis between buyers and sellers in that market, 
where that data is available and reflects sufficient liquidity.\26\
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    \25\ The Commission has previously approved for Exchange trading 
issues of Currency Trust Shares based on the WM/Reuters closing 
rate. See, e.g., Securities Exchange Act Release No. 58365 (August 
14, 2008), 73 FR 49522 (August 21, 2008) (SR-NYSEArca-2008-81) 
(notice of filing and order granting accelerated approval of 
proposed rule change relating to listing and trading of four 
CurrencyShares Trusts). The Sponsor represents that WM/Reuters 
utilizes the same methodology in calculating the Closing Spot Rate 
and the ``Spot Rate'' as defined herein. In addition, the Commission 
has approved for Exchange listing and trading exchange-traded 
products based on indexes that use the WM/Reuters Closing Spot Rate 
to calculate the applicable foreign currency exchange rate. See, 
e.g., Securities Exchange Act Release Nos. 56592 (October 1, 2007), 
72 FR 57364 (October 9, 2007) (SR-Amex-2007-60) (order approving 
proposed rule change relating to the listing and trading on the 
American Stock Exchange of shares of eight funds of the ProShares 
Trust based on MSCI international equity indexes); 55985 (June 29, 
2007), 72 FR 37291 (July 9, 2007) (SR-NYSEArca-2007-47) (notice of 
filing and order granting accelerated approval of proposed rule 
change to list and trade shares of the iShares FTSE EPRA/NAREIT Asia 
Index Funds). See also, Securities Exchange Act Release Nos. 58458 
(September 3, 2008), 73 FR 52717 (September 10, 2008) (SR-NYSEArca-
2008-95) (notice of filing and immediate effectiveness of proposed 
rule change relating to a change in net asset value calculations for 
CurrencyShares Trusts to use the WM/Reuters Closing Spot Rate); 
79518 (December 9, 2016), 81 FR 90876 (December 15, 2016) (SR-
NYSEArca-2016-84) (order approving listing and trading of shares of 
the Long Dollar Gold Trust).
    \26\ The Spot Rate is calculated by WMR using observable data 
from arms-length transactions between buyers and sellers in the 
applicable currency market.
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    The Thomson Reuters Market Data System is the primary 
infrastructure used to source spot foreign exchange rates used in the 
calculation of the rates. Other systems may be used where the 
appropriate rates are not available on the Thomson Reuters 
architecture.
    Over a five-minute fix period, actual trades executed and bid and 
offer order rates from the order matching systems are captured every 
second from 2 minutes 30 seconds before to 2 minutes 30 seconds after 
the time of the fix. From each data source, a single traded rate will 
be captured--this will be identified as a bid or offer depending on 
whether the trade is a buy or sell. A pre-defined spread set for each 
currency at each fix to reflect liquidity at different times of day 
will be applied to the Trade Rate to calculate the opposite bid or 
offer. All captured trades will be subjected to validation checks. This 
may result in some captured data being excluded from the fix 
calculation.
    In most spot currency transactions, settlement is two currency 
business days after the trade date. A spot-next trade effectively 
extends the spot settlement cycle by one Business Day (i.e., the 
``next'' day) and a Spot-Next Forward Point represents the difference 
in price between a spot transaction and a spot-next trade. Combining a 
spot-next trade with a spot transaction allows for exposure to the 
currency without taking delivery. By entering on each Index Business 
Day into notional spot-next trades that are closed the next Index 
Business Day against spot transactions, each Index is exposed to its 
corresponding Reference Currency without having to take delivery of the 
currency. Each Index approximates the cost of entering into a spot-next 
trade by linearly interpolating the cost of that trade based on the WM/
Reuters ``SW--Spot Week (One Week)'' forward rates and a spot 
transaction.
    The following table sets forth the Reference Currencies (each of 
which is measured against USDs) and the applicable Reuters Page for 
each SW--Spot Week (One Week) forward rate referenced by each Index.

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            Reference currency                      Reuters page
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EUR/USD...................................  USDEURSWFIX=WM.
USD/JPY...................................  USDJPYSWFIX=WM.
GBP/USD...................................  USDGBPSWFIX=WM.
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    Each Index references the SW--Spot Week (One Week) forward rate for 
its Reference Currency as of 9:00 a.m. London time.
    The Index Provider will publish the Index Levels (also referred to 
herein as ``Index values'') as of each Index Business Day in accordance 
with the Index Rules. If an Index Business Day is not a Publication 
Day, the Index Provider will not publish the Index Levels and the Index 
Provider will resume publishing the Index Levels on the immediately 
following Publication Day, subject to the consequences of the 
occurrence of a Market Disruption Event or Extraordinary Event. A 
``Publication Day'' is any day that (a) is an Index Business Day and 
(b) is not on a day on which a Market Disruption Event or Extraordinary 
Event has occurred or is continuing.
The Gold Delivery Agreement
    Pursuant to the terms of the Gold Delivery Agreement, each Fund 
will enter into a transaction to deliver Gold Bullion to, or receive 
Gold Bullion from, the ``Gold Delivery Provider'' each Business Day''. 
The amount of Gold Bullion transferred essentially will be equivalent 
to the Fund's profit or loss as if the Fund had exchanged the 
corresponding Reference Currency for USDs in an amount equal to the 
Fund's holdings of Gold Bullion on such day. In general, if there is a 
currency gain (i.e., the value of the USD against the corresponding 
Reference Currency increases), the Fund will receive Gold Bullion.\27\ 
In general, if there is a currency loss (i.e., the value of the USD 
against the corresponding Reference Currency decreases), the Fund will 
deliver Gold Bullion. In this manner, the amount of Gold Bullion held 
by a

[[Page 18496]]

Fund will be adjusted to reflect the daily change in the value of the 
corresponding Reference Currency against the USD.\28\ The Gold Delivery 
Agreement requires Gold Bullion ounces equal to the value of the ``Gold 
Delivery Amount'' to be delivered to the custody account of a Fund or 
the Gold Delivery Provider, as applicable. The fee that a Fund pays the 
Gold Delivery Provider for its services under the Gold Delivery 
Agreement is accrued daily and reflected in the calculation of the Gold 
Delivery Amount. The Gold Delivery Amount is the amount of Gold Bullion 
to be delivered into or out of a Fund on a daily basis to reflect price 
movements in the Fund's corresponding Reference Currency against the 
USD, calculated pursuant to the Gold Delivery Agreement.
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    \27\ The Gold Delivery Provider will not be affiliated with the 
Trust, the Funds, the Sponsor, the Trustee, the Administrator, the 
Transfer Agent, the Custodian or the Index Provider.
    \28\ If the applicable currency exchange rates did not change 
from one day to the next, or the net impact of such changes was 
zero, then a Fund would neither deliver nor receive Gold Bullion 
pursuant to the Gold Delivery Agreement.
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Market Disruption and Extraordinary Events
    From time to time, unexpected events may cause the calculation of 
an Index and/or the operation of a Fund to be disrupted. These events 
are expected to be relatively rare, but there can be no guarantee that 
these events will not occur. These events are referred to as either 
``Market Disruption Events'' or ``Extraordinary Events'' depending 
largely on their significance and potential impact to the Index and 
Fund. Market Disruption Events with respect to a Fund generally include 
disruptions in the trading of gold or the Fund's Reference Currency, 
delays or disruptions in the publication of the LBMA Gold Price or the 
Reference Currency prices, and unusual market or other events that are 
tied to either the trading of gold or the Reference Currency or 
otherwise have a significant impact on the trading of gold or the 
Reference Currency. For example, market conditions or other events 
which result in a material limitation in, or a suspension of, the 
trading of physical gold generally would be considered Market 
Disruption Events, as would material disruptions or delays in the 
determination or publication of the LBMA Gold Price AM. Similarly, 
market conditions which prevent, restrict or delay the Gold Delivery 
Provider's ability to convert a Reference Currency to USDs or deliver a 
Reference Currency through customary channels generally would be 
considered a Market Disruption Event, as would material disruptions or 
delays in the determination or publication of WMR spot prices for any 
Reference Currency. The complete definition of a Market Disruption 
Event is set forth below.
    A ``Market Disruption Event'' with respect to a Fund occurs if 
either an ``FX Disruption Event'' or a ``Gold Disruption Event'' 
occurs.
    An ``FX Disruption Event'' with respect to a Fund occurs if any of 
the following exist on any Index Business Day with respect to the 
Fund's Reference Currency:
    (i) an event, circumstance or cause (including, without limitation, 
the adoption of or any change in any applicable law or regulation) that 
has had or would reasonably be expected to have a materially adverse 
effect on the availability of a market for converting such Reference 
Currency to US Dollars (or vice versa), whether due to market 
illiquidity, illegality, the adoption of or change in any law or other 
regulatory instrument, inconvertibility, establishment of dual exchange 
rates or foreign exchange controls or the occurrence or existence of 
any other circumstance or event, as determined by the Index Provider; 
or
    (ii) the failure of Reuters to announce or publish the relevant 
spot exchange rates for such Reference Currency; or
    (iii) any event or any condition that (I) results in a lack of 
liquidity in the market for trading such Reference Currency that makes 
it impossible or illegal for market participants (a) to convert from 
one currency to another through customary commercial channels, (b) to 
effect currency transactions in, or to obtain market values of, such, 
currency, (c) to obtain a firm quote for the related exchange rate, or 
(d) to obtain the relevant exchange rate by reference to the applicable 
price source; or (II) leads to any governmental entity imposing rules 
that effectively set the prices of any of the currencies; or
    (iv) the declaration of (a) a banking moratorium or the suspension 
of payments by banks, in either case, in the country of any currency 
used to determine such Reference Currency exchange rate, or (b) capital 
and/or currency controls (including, without limitation, any 
restriction placed on assets in or transactions through any account 
through which a non-resident of the country of any currency used to 
determine the currency exchange rate may hold assets or transfer monies 
outside the country of that currency, and any restriction on the 
transfer of funds, securities or other assets of market participants 
from, within or outside of the country of any currency used to 
determine the applicable exchange rate.
    A ``Gold Disruption Event'' with respect to a Fund occurs if any of 
the following exist on any Index Business Day with respect to gold:
    (i) (a) The failure of the LBMA to announce or publish the LBMA 
Gold Price (or the information necessary for determining the price of 
gold) on that Index Business Day, (b) the temporary or permanent 
discontinuance or unavailability of the LBMA or the LBMA Gold Price; or
    (ii) the material suspension of, or material limitation imposed on, 
trading in gold by the LBMA; or
    (iii) an event that causes market participants to be unable to 
deliver gold bullion loco London under rules of the LBMA by credit to 
an unallocated account at a member of the LBMA; or
    (iv) the permanent discontinuation of trading of gold on the LBMA 
or any successor body thereto, the disappearance of, or of trading in, 
gold; or
    (v) a material change in the formula for or the method of 
calculating the price of gold, or a material change in the content, 
composition or constitution of gold.
    The occurrence of a Market Disruption Event with respect to a Fund 
for ten consecutive Index Business Days generally would be considered 
an Extraordinary Event with respect to such Fund.
Consequences of a Market Disruption or Extraordinary Event
    On any Index Business Day in which a Market Disruption Event or 
Extraordinary Event with respect to a Fund has occurred or is 
continuing, the Index Provider generally will calculate a Fund's Index 
based on the following fallback procedures: (i) Where the Market 
Disruption Event is based on the Gold Price, the Index will be kept at 
the same level as the previous Index Business Day and updated when the 
Gold Price is no longer disrupted; (ii) where the Gold Price is not 
disrupted but the corresponding Reference Currency price is disrupted, 
the Index will be calculated in the ordinary course except that the 
Reference Currency will be kept at its value from the previous Index 
Business Day and updated when it is no longer disrupted; and (iii) if 
both the Gold Price and the Reference Currency price are disrupted, the 
Index will be kept at the same level as the previous Index Business Day 
and updated when such prices are no longer disrupted. If a Market 
Disruption Event with respect to a Fund has occurred and is continuing 
for ten (10) or more consecutive Index Business Days, the Index 
Provider will calculate a

[[Page 18497]]

substitute price for each index component that is disrupted. If an 
Extraordinary Event with respect to a Fund has occurred and is 
continuing, the Index Provider shall be responsible for making any 
decisions regarding the future composition of the applicable Index and 
implement any necessary adjustments that might be required.
    If the LBMA Gold Price AM is unavailable during the occurrence of a 
Market Disruption Event or Extraordinary Event with respect to a Fund, 
a Fund will calculate NAV using the last published LBMA Gold Price AM.
The London Gold Bullion Market
    Although the market for physical gold is global, most OTC market 
trades are cleared through London. In addition to coordinating market 
activities, the LBMA acts as the principal point of contact between the 
market and its regulators. A primary function of the LBMA is its 
involvement in the promotion of refining standards by maintenance of 
the ``London Good Delivery Lists,'' which are the lists of LBMA 
accredited melters and assayers of gold. The LBMA also coordinates 
market clearing and vaulting, promotes good trading practices and 
develops standard documentation.
    The term ``loco London'' refers to gold bars physically held in 
London that meet the specifications for weight, dimensions, fineness 
(or purity), identifying marks (including the assay stamp of an LBMA 
acceptable refiner) and appearance set forth in ``The Good Delivery 
Rules for Gold and Silver Bars'' published by the LBMA. Gold bars 
meeting these requirements are known as ``London Good Delivery Bars.'' 
All of the Gold Bullion will be London Good Delivery Bars meeting the 
requirements of London Good Delivery Standards.
    The unit of trade in London is the troy ounce, whose conversion 
between grams is: 1,000 grams = 32.1507465 troy ounces and 1 troy ounce 
= 31.1034768 grams. A London Good Delivery Bar is acceptable for 
delivery in settlement of a transaction on the OTC market. Typically 
referred to as 400-ounce bars, a London Good Delivery Bar must contain 
between 350 and 430 fine troy ounces of gold, with a minimum fineness 
(or purity) of 995 parts per 1,000 (99.5%), be of good appearance and 
be easy to handle and stack. The fine gold content of a gold bar is 
calculated by multiplying the gross weight of the bar (expressed in 
units of 0.025 troy ounces) by the fineness of the bar.
The LBMA Gold Price
    The LBMA Gold Price is determined twice each Business Day (10:30 
a.m. and 3:00 p.m. London time) through an auction which provides 
reference gold prices for that day's trading. The LBMA Gold Price was 
initiated on March 20, 2015 and replaced the London PM Gold Fix. The 
auction that determines the LBMA Gold Price is a physically settled, 
electronic and tradeable auction, with the ability to settle trades in 
U.S. dollars, euros or British pounds. The IBA provides the auction 
platform and methodology as well as the overall administration and 
governance for the LBMA Gold Price. Many long-term contracts are 
expected to be priced on the basis of either the morning (AM) or 
afternoon (PM) LBMA Gold Price, and many market participants are 
expected to refer to one or the other of these prices when looking for 
a basis for valuations.
    Participants in the IBA auction process submit anonymous bids and 
offers which are published on screen and in real-time. Throughout the 
auction process, aggregated gold bids and offers are updated in real-
time with the imbalance calculated and the price updated every 45 
seconds until the buy and sell orders are matched. When the net volume 
of all participants falls within a pre-determined tolerance, the 
auction is deemed complete and the applicable LBMA Gold Price is 
published. Information about the auction process (such as aggregated 
bid and offer volumes) will be immediately available after the auction 
on the IBA's Web site.
    The Financial Conduct Authority, or FCA, in the U.K. regulates the 
LBMA Gold Price.
The Gold Futures Markets
    Although the Fund will not invest in gold futures, information 
about the gold futures market is relevant as such markets contribute 
to, and provide evidence of, the liquidity of the overall market for 
gold.
    The most significant gold futures exchange is COMEX, part of the 
CME Group, Inc., which began to offer trading in gold futures contracts 
in 1974. TOCOM (Tokyo Commodity Exchange) is another significant 
futures exchange and has been trading gold since 1982. Trading on these 
exchanges is based on fixed delivery dates and transaction sizes for 
the futures and options contracts traded. Trading costs are negotiable. 
As a matter of practice, only a small percentage of the futures market 
turnover ever comes to physical delivery of the gold represented by the 
contracts traded. Both exchanges permit trading on margin. Both COMEX 
and TOCOM operate through a central clearance system and in each case, 
the clearing organization acts as a counterparty for each member for 
clearing purposes. Gold futures contracts also are traded on the 
Shanghai Gold Exchange and the Shanghai Futures Exchange.
    The global gold markets are overseen and regulated by both 
governmental and self-regulatory organizations. In addition, certain 
trade associations have established rules and protocols for market 
practices and participants.
Net Asset Value
    The Administrator will determine the NAV of Shares of a Fund on 
each Business Day. The NAV of Shares of a Fund is the aggregate value 
of the Fund's assets (which include gold payable, but not yet 
delivered, to the Fund) less its liabilities (which include accrued but 
unpaid fees and expenses). The NAV of a Fund is calculated based on the 
price of gold per ounce applied against the number of ounces of Gold 
Bullion owned by the Fund. For purposes of calculating NAV, the number 
of ounces of Gold Bullion (i) is adjusted up or down on a daily basis 
to reflect the Gold Delivery Amount; and (ii) reflects the amount of 
Gold Bullion delivered into (or out of) a Fund on a daily basis by 
Authorized Participants creating and redeeming Shares. The number of 
ounces of Gold Bullion held by a Fund is adjusted downward by the 
Sponsor's fee and the expenses of the Gold Delivery Agreement.
    In determining a Fund's NAV, the Administrator generally will value 
the Gold Bullion based on the LBMA Gold Price AM for an ounce of gold. 
If no LBMA Gold Price AM is made on a particular evaluation day or if 
the LBMA Gold Price PM has not been announced by 12:00 p.m. Eastern 
time (``E.T.'') on a particular evaluation day (including a Business 
Day that is not an Index Business Day), the next most recent LBMA Gold 
Price AM generally will be used in the determination of the NAV of the 
Fund, unless the Sponsor determines that such price is inappropriate to 
use as the basis for such determination. If the Sponsor determines that 
such price is inappropriate to use, it shall identify an alternate 
basis for evaluation of the Gold Bullion held by the Fund. In such 
case, the Sponsor would, for example, look to the current trading price 
of gold from other reported sources, such as dealer quotes, broker 
quotes or electronic trading data, to value the Fund's Shares. Although 
the Fund will not hold the

[[Page 18498]]

Reference Currencies, the Gold Delivery Provider generally will value 
the Reference Currencies based on the rates in effect as of the WMR FX 
Fixing Time, which is generally at 9:00 a.m., London Time (though other 
prices may be used if the 9:00 a.m. rate is delayed or unavailable). 
The Administrator will also determine the NAV per Share, which equals 
the NAV of the Fund, divided by the number of outstanding Shares. 
Unless there is a Market Disruption Event or Extraordinary Event with 
respect to the price of gold, NAV generally will be calculated and 
disseminated by 12:00 p.m. E.T.
    The NAV generally will be calculated as of 12:00 p.m. E.T. on any 
Business Day. The Administrator will also determine the NAV per Share.
Creation and Redemption of Shares
    The Funds expect to create and redeem Shares but only in Creation 
Units (a Creation Unit equals a block of 10,000 Shares or more). The 
creation and redemption of Creation Units requires the delivery to a 
Fund (or the distribution by a Fund in the case of redemptions) of the 
amount of Gold Bullion and any cash, if any, represented by the 
Creation Units being created or redeemed. The total amount of Gold 
Bullion and cash, if any, required for the creation of Creation Units 
will be based on the combined NAV of the number of Creation Units being 
created or redeemed. The initial amount of Gold Bullion required for 
deposit with a Fund to create Shares is 1,000 ounces per Creation Unit. 
The number of ounces of Gold Bullion required to create a Creation Unit 
or to be delivered upon redemption of a Creation Unit will change over 
time depending on Index performance net of the fees charged by a Fund 
and the Gold Delivery Provider. Creation Units may be created or 
redeemed only by Authorized Participants (as described below), who may 
be required to pay a transaction fee for each order to create or redeem 
Creation Units as will be set forth in the Registration Statement. 
Authorized Participants may sell to other investors all or part of the 
Shares included in the Creation Units they purchase from a Fund.
Creation Procedures--Authorized Participants
    Authorized Participants are the only persons that may place orders 
to create and redeem Creation Units. To become an Authorized 
Participant, a person must enter into a Participant Agreement. All Gold 
Bullion must be delivered to a Fund and distributed by a Fund in 
unallocated form through credits and debits between an Authorized 
Participant's unallocated account (``Authorized Participant Unallocated 
Account'') and a Fund's unallocated account (``Fund Unallocated 
Account'') (except for Gold Bullion delivered to or from the Gold 
Delivery Provider pursuant to the Gold Delivery Agreement). All Gold 
Bullion must be of at least a minimum fineness (or purity) of 995 parts 
per 1,000 (99.5%) and otherwise conform to the rules, regulations 
practices and customs of the LBMA, including the specifications for a 
London Good Delivery Bar.
    On any Business Day, an Authorized Participant may place an order 
with a Fund to create one or more Creation Units. Purchase orders must 
be placed by 5:30 p.m., E.T. The day on which a Fund receives a valid 
purchase order is the purchase order date. By placing a purchase order, 
an Authorized Participant agrees to deposit Gold Bullion with a Fund, 
or a combination of Gold Bullion and cash, if any, as described 
below.\29\ Prior to the delivery of Creation Units for a purchase 
order, the Authorized Participant must also have wired to a Fund the 
non-refundable transaction fee due for the purchase order.
---------------------------------------------------------------------------

    \29\ The Sponsor anticipates that in the ordinary course of a 
Fund's operations cash generally will not be part of any Creation 
Unit.
---------------------------------------------------------------------------

    The total deposit of Gold Bullion (and cash, if any) required to 
create each Creation Unit is referred to as the ``Creation Unit Gold 
Delivery Amount.'' The Creation Unit Gold Delivery Amount is the number 
of ounces of Gold Bullion required to be delivered to a Fund by an 
Authorized Participant in connection with a creation order for a single 
Creation Unit.\30\ The Creation Unit Gold Delivery Amount will be 
determined on the Business Day following the date such creation order 
is accepted. It is calculated by multiplying the number of Shares in a 
Creation Unit by the number of ounces of Gold Bullion associated with 
Fund Shares on the Business Day after the day the creation order is 
accepted. In addition, because the Gold Delivery Amount for a Fund does 
not reflect creation order transactions (see the section herein 
entitled ``The Gold Delivery Agreement''), the Creation Unit Gold 
Delivery Amount is required to reflect the Gold Delivery Amount 
associated with such creation order. This amount is determined on the 
Business Day following the date such creation order is accepted.
---------------------------------------------------------------------------

    \30\ The ``Creation Unit Gold Delivery Amount'' is also used to 
refer to the number of ounces of Gold to be paid by the Fund to an 
Authorized Participant in connection with the redemption of a 
Creation Unit. See ``Redemption Procedures--Authorized 
Participants'' herein.
---------------------------------------------------------------------------

    An Authorized Participant who places a purchase order is 
responsible for crediting its Authorized Participant Unallocated 
Account with the required Gold Bullion deposit amount by the end of the 
third Business Day in London following the purchase order date. Upon 
receipt of the Gold Bullion deposit amount, the Custodian, after 
receiving appropriate instructions from the Authorized Participant and 
a Fund, will transfer on the third Business Day following the purchase 
order date the Gold Bullion deposit amount from the Authorized 
Participant Unallocated Account to a Fund Unallocated Account and the 
Administrator will direct the Depository Trust Company (``DTC'') to 
credit the number of Creation Units ordered to the Authorized 
Participant's DTC account. The expense and risk of delivery, ownership 
and safekeeping of Gold Bullion until such Gold Bullion has been 
received by a Fund will be borne solely by the Authorized Participant. 
If Gold Bullion is to be delivered other than as described above, the 
Sponsor is authorized to establish such procedures and to appoint such 
custodians and establish such custody accounts as the Sponsor 
determines to be desirable.
    Acting on standing instructions given by a Fund, the Custodian will 
transfer the Gold Bullion deposit amount from a Fund Unallocated 
Account to a Fund's allocated account by allocating to the allocated 
account specific bars of Gold Bullion which the Custodian holds or 
instructing a subcustodian to allocate specific bars of Gold held by or 
for the subcustodian. The Gold Bullion bars in an allocated Gold 
Bullion account are specific to that account and are identified by a 
list which shows, for each Gold Bullion bar, the refiner, assay or 
fineness, serial number and gross and fine weight. Gold Bullion held in 
a Fund's allocated account is the property of a Fund and is not traded, 
leased or loaned under any circumstances.
    The Custodian will use commercially reasonable efforts to complete 
the transfer of Gold Bullion to a Fund's allocated account prior to the 
time by which the Administrator is to credit the Creation Unit to the 
Authorized Participant's DTC account; if, however, such transfers have 
not been completed by such time, the number of Creation Units ordered 
will be delivered against receipt of the Gold Bullion deposit amount in 
a Fund's unallocated account, and all Shareholders will be exposed to 
the risks of unallocated Gold Bullion to the extent of that Gold 
Bullion deposit amount until the

[[Page 18499]]

Custodian completes the allocation process.
Redemption Procedures--Authorized Participants
    The procedures by which an Authorized Participant can redeem one or 
more Creation Units mirror the procedures for the creation of Creation 
Units. On any Business Day, an Authorized Participant may place an 
order with a Fund to redeem one or more Creation Units. Redemption 
orders must be placed by 5:30 p.m. E.T. A redemption order so received 
is effective on the date it is received in satisfactory form by a Fund. 
An Authorized Participant may be required to pay a transaction fee per 
order to create or redeem Creation Units as will be set forth in the 
Registration Statement.
    (a) The redemption distribution from a Fund consists of a credit in 
the amount of the Creation Unit Gold Delivery Amount to the Authorized 
Participant Unallocated Account of the redeeming Authorized 
Participant. The Creation Unit Delivery Amount for redemptions is the 
number of ounces of Gold Bullion held by a Fund associated with the 
Shares being redeemed plus, or minus, the cash redemption amount (if 
any). The Sponsor anticipates that in the ordinary course of a Fund's 
operations there will be no cash distributions made to Authorized 
Participants upon redemptions. In addition, because the Gold Bullion to 
be paid out in connection with the redemption order will decrease the 
amount of Gold Bullion subject to the Gold Delivery Agreement, the 
Creation Unit Gold Delivery Amount reflects the cost to the Gold 
Delivery Provider of resizing (i.e., decreasing) its positions so that 
it can fulfill its obligations under the Gold Delivery Agreement.
    The redemption distribution due from a Fund is delivered to the 
Authorized Participant on the third Business Day following the 
redemption order date if, by 10:00 a.m. E.T. on such third Business 
Day, a Fund's DTC account has been credited with the Creation Units to 
be redeemed. If the Administrator's DTC account has not been credited 
with all of the Creation Units to be redeemed by such time, the 
redemption distribution is delivered to the extent of whole Creation 
Units received. Any remainder of the redemption distribution is 
delivered on the next Business Day to the extent of remaining whole 
Creation Units received if the Administrator receives the fee 
applicable to the extension of the redemption distribution date which 
the Administrator may, from time to time, determine and the remaining 
Creation Units to be redeemed are credited to the Administrator's DTC 
account by 10:00 a.m. E.T. on such next Business Day. Any further 
outstanding amount of the redemption order will be cancelled. The 
Administrator is also authorized to deliver the redemption distribution 
notwithstanding that the Creation Units to be redeemed are not credited 
to the Administrator's DTC account by 10:00 a.m. E.T. on the third 
Business Day following the redemption order date if the Authorized 
Participant has collateralized its obligation to deliver the Creation 
Units through DTC's book entry system on such terms as the Sponsor and 
the Administrator may from time to time agree upon.
    The Custodian transfers the redemption Gold Bullion amount from a 
Fund's allocated account to a Fund's unallocated account and, 
thereafter, to the redeeming Authorized Participant's Authorized 
Participant Unallocated Account.
Secondary Market Trading
    While a Fund's investment objective is for its Shares to reflect 
the performance of Gold Bullion in terms of a Reference Currency 
reflected in the applicable Index, less the expenses of a Fund, the 
Shares may trade in the secondary market at prices that are lower or 
higher relative to their NAV per Share. The amount of the discount or 
premium in the trading price relative to the NAV per Share may be 
influenced by non-concurrent trading hours between the NYSE Arca and 
the COMEX, London, Zurich and Singapore. While the Shares will trade on 
NYSE Arca until 8:00 p.m. E.T., liquidity in the global gold market 
will be reduced after the close of the COMEX at 1:30 p.m. E.T. As a 
result, during this time, trading spreads, and the resulting premium or 
discount, on the Shares may widen.
    The Adviser represents that market makers in the Shares will be 
able to efficiently hedge their positions through use of spot gold 
transactions and spot currency transactions in Reference Currencies. 
Transactions in spot gold and spot currencies during the Exchange's 
Core Trading Session (9:30 a.m. to 4:00 p.m. E.T.) take place in a 
highly liquid market; such transactions that hedge the market makers' 
positions in Shares are expected to facilitate the market maker's 
ability to trade Shares at a price that is not at a material discount 
or premium to NAV.
Availability of Information Regarding Gold and Reference Currency 
Prices
    Currently, the Consolidated Tape Plan does not provide for 
dissemination of the spot price of a commodity, such as gold, or the 
spot price of the Reference Currencies, over the Consolidated Tape. 
However, there will be disseminated over the Consolidated Tape the last 
sale price for the Shares, as is the case for all equity securities 
traded on the Exchange (including exchange-traded funds). In addition, 
there is a considerable amount of information about gold and currency 
prices and gold and currency markets available on public Web sites and 
through professional and subscription services.
    Investors may obtain on a 24-hour basis gold pricing information 
based on the spot price for an ounce of gold and pricing information 
for the Reference Currencies from various financial information service 
providers, such as Reuters and Bloomberg.
    Reuters and Bloomberg, for example, provide at no charge on their 
Web sites delayed information regarding the spot price of gold and last 
sale prices of gold futures, as well as information about news and 
developments in the gold market. Reuters and Bloomberg also offer a 
professional service to subscribers for a fee that provides information 
on gold prices directly from market participants. Complete real-time 
data for gold futures and options prices traded on the COMEX are 
available by subscription from Reuters and Bloomberg. There are a 
variety of other public Web sites providing information on gold, 
ranging from those specializing in precious metals to sites maintained 
by major newspapers. In addition, the LBMA Gold Price is publicly 
available at no charge at www.lbma.org.uk.
    In addition, Reuters and Bloomberg, for example, provide at no 
charge on their Web sites delayed information regarding the spot price 
of each Reference Currency, as well as information about news and 
developments in the currency markets. Reuters and Bloomberg also offer 
a professional service to subscribers for a fee that provides 
information on currency transactions directly from market participants. 
Complete real-time data for currency transactions are available by 
subscription from Reuters and Bloomberg. There are a variety of other 
public Web sites providing information about the Reference Currencies 
and currency transactions, ranging from those specializing in currency 
trading to sites maintained by major newspapers.

[[Page 18500]]

Availability of Information
    The Funds' Web site will provide an intraday indicative value 
(``IIV'') per Share for the Shares updated every 15 seconds, as 
calculated by the Exchange or a third party financial data provider 
during the Exchange's Core Trading Session (9:30 a.m. to 4:00 p.m. 
E.T.) The IIV will be calculated based on the amount of gold held by 
the Fund and (i) a price of gold derived from updated bids and offers 
indicative of the spot price of gold, and (ii) intra-day exchange rates 
for each Reference Currency against the U.S. dollar.\31\ The Funds' Web 
site will also provide the Creation Basket Deposit and the NAV of the 
Fund as calculated each Business Day by the Administrator. The value 
for each Index will be disseminated by one or more major market data 
vendors each Index Business Day at approximately 6:00 a.m. E.T.
---------------------------------------------------------------------------

    \31\ The IIV on a per Share basis disseminated during the Core 
Trading Session should not be viewed as a real-time update of the 
NAV, which is calculated once a day.
---------------------------------------------------------------------------

    In addition, the Web site for each Fund will contain the following 
information, on a per Share basis, for the Fund: (a) The mid-point of 
the bid-ask price \32\ at the close of trading (``Bid/Ask Price''), and 
a calculation of the premium or discount of such price against such 
NAV; and (b) data in chart format displaying the frequency distribution 
of discounts and premiums of the Bid/Ask Price against the NAV, within 
appropriate ranges, for each of the four previous calendar quarters. 
The Web site for each Fund will also provide the Fund's prospectus, as 
well as the two most recent reports to stockholders. Finally, the 
Funds' Web site will provide the last sale price of the Shares as 
traded in the U.S. market. In addition, the Exchange will make 
available over the Consolidated Tape quotation information, trading 
volume, closing prices and NAV for the Shares from the previous day. 
The Index value will be calculated daily using the daily LBMA Gold 
Price AM and the Spot Rate as of 9:00 a.m., London time. The Index 
value will be available from one or more major market data vendors and 
will be available during the Exchange's Core Trading Session.
---------------------------------------------------------------------------

    \32\ The bid-ask price of the Shares will be determined using 
the highest bid and lowest offer on the Consolidated Tape as of the 
time of calculation of the closing day NAV.
---------------------------------------------------------------------------

Criteria for Initial and Continued Listing
    The Funds will be subject to the criteria in NYSE Arca Equities 
Rule 8.201(e) for initial and continued listing of the Shares.
    A minimum of 100,000 Shares will be required to be outstanding at 
the start of trading. The minimum number of shares required to be 
outstanding is comparable to requirements that have been applied to 
previously listed shares of the Sprott Physical Gold Trust, ETFS 
Trusts, streetTRACKS Gold Trust, the iShares COMEX Gold Trust, and the 
iShares Silver Trust. The Exchange believes that the anticipated 
minimum number of Shares outstanding at the start of trading is 
sufficient to provide adequate market liquidity.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares of the Funds subject to the Exchange's 
existing rules governing the trading of equity securities. Trading in 
the Shares on the Exchange will occur in accordance with NYSE Arca 
Equities Rule 7.34(a). The Exchange has appropriate rules to facilitate 
transactions in the Shares during all trading sessions. As provided in 
NYSE Arca Equities Rule 7.6, Commentary .03, the minimum price 
variation (``MPV'') for quoting and entry of orders in equity 
securities traded on the NYSE Arca Marketplace is $0.01, with the 
exception of securities that are priced less than $1.00 for which the 
MPV for order entry is $0.0001.
    Under NYSE Arca Equities Rule 8.201(g), an ETP Holder acting as a 
registered Market Maker in Commodity-Based Trust Shares with exposure 
to one or more non-U.S. currencies (``Underlying FX'') must file with 
the Exchange, in a manner prescribed by the Exchange, and keep current 
a list identifying all accounts for trading in Underlying FX and 
derivatives overlying Underlying FX which the Market Maker may have or 
over which it may exercise investment discretion, as well as a list of 
all commodity and commodity-related accounts referenced above. In 
addition, no Market Maker in Commodity-Based Trust Shares shall trade 
in a commodity, Underlying FX or any related derivative in an account 
that the Market Maker (1) directly or indirectly controls trading 
activities or has a direct interest in the profits or losses thereof, 
(2) is required by this rule to disclose to the Exchange, and (3) has 
not reported to the Exchange. In addition to the existing obligations 
under Exchange rules regarding the production of books and records, an 
ETP Holder acting as a Market Maker in Commodity-Based Trust Shares 
shall make available to the Exchange such books, records or other 
information pertaining to transactions by such entity or registered or 
non-registered employee affiliated with such entity for its or their 
own accounts for trading the underlying physical commodity, related 
commodity futures or options on commodity futures, applicable 
Underlying FX, or any other related commodity or applicable Underlying 
FX derivatives, as may be requested by the Exchange.
    The Exchange notes that, under NYSE Arca Equities Rule 10.2, in the 
course of an investigation by the Exchange, the Exchange may request 
from ETP Holders documentary materials and other information, including 
trading records, regarding trading in currencies and currency 
derivatives. In addition, Commentary .04 of NYSE Arca Equities Rule 6.3 
requires an ETP Holder acting as a registered Market Maker, and its 
affiliates, in the Shares to establish, maintain and enforce written 
policies and procedures reasonably designed to prevent the misuse of 
any material nonpublic information with respect to such products, any 
components of the related products, any physical asset or commodity 
underlying the product, applicable currencies, underlying indexes, 
related futures or options on futures, and any related derivative 
instruments (including the Shares).
    As a general matter, the Exchange has regulatory jurisdiction over 
its ETP Holders and their associated persons, which include any person 
or entity controlling an ETP Holder. A subsidiary or affiliate of an 
ETP Holder that does business only in commodities or futures contracts 
would not be subject to Exchange jurisdiction, but the Exchange could 
obtain information regarding the activities of such subsidiary or 
affiliate through surveillance sharing agreements with regulatory 
organizations of which such subsidiary or affiliate is a member.
    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in the Shares. Trading on the Exchange in the Shares may be 
halted because of market conditions or for reasons that, in the view of 
the Exchange, make trading in the Shares inadvisable. In addition, 
trading in Shares will be subject to trading halts caused by 
extraordinary market volatility pursuant to the Exchange's ``circuit 
breaker'' rule.\33\ The Exchange will halt trading in the Shares if the 
NAV of the Trust is not calculated or disseminated daily. The Exchange 
may halt trading during the day in which an interruption occurs to the 
dissemination of the IIV, as described above, or the Index value. If 
the interruption to the dissemination of the IIV or the Index value 
persists past the

[[Page 18501]]

trading day in which it occurs, the Exchange will halt trading no later 
than the beginning of the trading day following the interruption.
---------------------------------------------------------------------------

    \33\ See NYSE Arca Equities Rule 7.12.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares will be subject 
to the existing trading surveillances administered by the Exchange, as 
well as cross-market surveillances administered by the Financial 
Industry Regulatory Authority (``FINRA'') on behalf of the Exchange, 
which are designed to detect violations of Exchange rules and 
applicable federal securities laws.\34\ The Exchange represents that 
these procedures are adequate to properly monitor Exchange trading of 
the Shares in all trading sessions and to deter and detect violations 
of Exchange rules and federal securities laws applicable to trading on 
the Exchange.
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    \34\ FINRA conducts cross-market surveillances on behalf of the 
Exchange pursuant to a regulatory services agreement. The Exchange 
is responsible for FINRA's performance under this regulatory 
services agreement.
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    The surveillances referred to above generally focus on detecting 
securities trading outside their normal patterns, which could be 
indicative of manipulative or other violative activity. When such 
situations are detected, surveillance analysis follows and 
investigations are opened, where appropriate, to review the behavior of 
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will 
communicate as needed regarding trading in the Shares with other 
markets and other entities that are members of the ISG, and the 
Exchange or FINRA, on behalf of the Exchange, or both, may obtain 
trading information regarding trading in the Shares from such markets 
and other entities. In addition, the Exchange may obtain information 
regarding trading in the Shares from markets and other entities that 
are members of ISG or with which the Exchange has in place a 
comprehensive surveillance sharing agreement.\35\
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    \35\ For a list of the current members of ISG, see 
www.isgportal.org.
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    Also, pursuant to NYSE Arca Equities Rule 8.201(g), the Exchange is 
able to obtain information regarding trading in the Shares and the 
underlying gold, gold futures contracts, options on gold futures, any 
other gold derivative, applicable non-U.S. currencies or applicable 
non-U.S. currency derivatives through ETP Holders acting as registered 
Market Makers, in connection with such ETP Holders' proprietary or 
customer trades through ETP Holders which they effect on any relevant 
market.
    All statements and representations made in this filing regarding 
(a) the description of the portfolios of the Funds, (b) limitations on 
portfolio holdings, or (c) the applicability of Exchange listing rules 
specified in this rule filing shall constitute continued listing 
requirements for listing the Shares on the Exchange.
    The issuer has represented to the Exchange that it will advise the 
Exchange of any failure by the Funds to comply with the continued 
listing requirements, and, pursuant to its obligations under Section 
19(g)(1) of the Act, the Exchange will monitor for compliance with the 
continued listing requirements. If a Fund is not in compliance with the 
applicable listing requirements, the Exchange will commence delisting 
procedures under NYSE Arca Equities Rule 5.5(m).
    In addition, the Exchange also has a general policy prohibiting the 
distribution of material, non-public information by its employees.
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its 
ETP Holders in an Information Bulletin of the special characteristics 
and risks associated with trading the Shares. Specifically, the 
Information Bulletin will discuss the following: (1) The procedures for 
purchases and redemptions of Shares in Baskets (including noting that 
Shares are not individually redeemable); (2) NYSE Arca Equities Rule 
9.2(a), which imposes a duty of due diligence on its ETP Holders to 
learn the essential facts relating to every customer prior to trading 
the Shares; (3) how information regarding the IIV is disseminated; (4) 
the requirement that ETP Holders deliver a prospectus to investors 
purchasing newly issued Shares prior to or concurrently with the 
confirmation of a transaction; (5) the possibility that trading spreads 
and the resulting premium or discount on the Shares may widen as a 
result of reduced liquidity of gold trading during the Core and Late 
Trading Sessions after the close of the major world gold markets; and 
(6) trading information. For example, the Information Bulletin will 
advise ETP Holders, prior to the commencement of trading, of the 
prospectus delivery requirements applicable to a Fund. The Exchange 
notes that investors purchasing Shares directly from a Fund (by 
delivery of the Creation Basket Deposit) will receive a prospectus. ETP 
Holders purchasing Shares from a Fund for resale to investors will 
deliver a prospectus to such investors.
    In addition, the Information Bulletin will reference that a Fund is 
subject to various fees and expenses as will be described in the 
Registration Statement. The Information Bulletin will also reference 
the fact that there is no regulated source of last sale information 
regarding physical gold, that the Commission has no jurisdiction over 
the trading of gold as a physical commodity, and that the Commodity 
Futures Trading Commission has regulatory jurisdiction over the trading 
of gold futures contracts and options on gold futures contracts.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under Section 6(b)(5) \36\ that an exchange have rules that 
are designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to, and perfect the mechanism of a free and open market 
and, in general, to protect investors and the public interest. The 
Exchange believes that the proposed rule change is designed to prevent 
fraudulent and manipulative acts and practices in that the Shares will 
be listed and traded on the Exchange pursuant to the initial and 
continued listing criteria in NYSE Arca Equities Rule 8.201. The 
Exchange has in place surveillance procedures that are adequate to 
properly monitor trading in the Shares in all trading sessions and to 
deter and detect violations of Exchange rules and applicable federal 
securities laws. The Exchange may obtain information via ISG from other 
exchanges that are members of ISG or with which the Exchange has 
entered into a comprehensive surveillance sharing agreement. Under NYSE 
Arca Equities Rule 10.2, in the course of an investigation by the 
Exchange, the Exchange may request from ETP Holders documentary 
materials and other information, including trading records, regarding 
trading in currencies and currency derivatives. In addition, Commentary 
.04 of NYSE Arca Equities Rule 6.3 requires an ETP Holder acting as a 
registered Market Maker, and its affiliates, in the Shares to 
establish, maintain and enforce written policies and procedures 
reasonably designed to prevent the misuse of any material nonpublic 
information with respect to such products, any components of the 
related products, any physical asset or commodity underlying the 
product, applicable currencies, underlying

[[Page 18502]]

indexes, related futures or options on futures, and any related 
derivative instruments (including the Shares).
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    \36\ 15 U.S.C. 78f(b)(5).
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    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that there is a considerable amount of gold price and gold market 
information available on public Web sites and through professional and 
subscription services. Investors may obtain on a 24-hour basis gold 
pricing information based on the spot price for an ounce of gold from 
various financial information service providers. Investors may obtain 
gold pricing information based on the spot price for an ounce of gold 
from various financial information service providers. Current spot 
prices also are generally available with bid/ask spreads from gold 
bullion dealers. In addition, the Funds' Web site will provide pricing 
information for gold spot prices and the Shares. Market prices for the 
Shares will be available from a variety of sources including brokerage 
firms, information Web sites and other information service providers. 
The NAV of the Funds will be published by the Sponsor on each day that 
the NYSE Arca is open for regular trading and will be posted on the 
Funds' Web site. The IIV relating to the Shares will be widely 
disseminated by one or more major market data vendors at least every 15 
seconds during the Core Trading Session. In addition, the LBMA Gold 
Price is publicly available at no charge at www.lbma.org.uk. The Funds' 
Web site will also provide the Funds' prospectus, as well as the two 
most recent reports to stockholders. In addition, the Exchange will 
make available over the Consolidated Tape quotation information, 
trading volume, closing prices and NAV for the Shares from the previous 
day.
    The proposed rule change is designed to perfect the mechanism of a 
free and open market and, in general, to protect investors and the 
public interest in that it will facilitate the listing and trading of 
an additional type of exchange-traded product that will enhance 
competition among market participants, to the benefit of investors and 
the marketplace. As noted above, the Exchange has in place surveillance 
procedures relating to trading in the Shares and may obtain information 
via ISG from other exchanges that are members of ISG or with which the 
Exchange has entered into a comprehensive surveillance sharing 
agreement. In addition, as noted above, investors will have ready 
access to information regarding gold pricing.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange believes the 
proposed rule change will enhance competition by accommodating Exchange 
trading of an additional exchange-traded product relating to physical 
gold.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as modified by Amendment No. 1, is consistent with the Act. 
Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2017-33 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2017-33. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-NYSEArca-2017-33, and should 
be submitted on or before May 10, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\37\
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    \37\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2017-07877 Filed 4-18-17; 8:45 am]
 BILLING CODE 8011-01-P


