Filed Pursuant To Rule 433
Registration No. 333-209926
July 13, 2016
Good Re-Appraising as Gold Strategic Allocations to Gold
For thousands of years gold has been one of the world’s most valuable metals, used as both a form of currency and an investment. Investors have traditionally used gold to help
preserve wealth in times of market volatility or periods of high inflation and to diversify portfolios. Beginning in 2013, concerns surrounding rising interest rates and a strong US dollar put pressure on the price of gold, and many investors
reassessed gold’s value and questioned how it should be used in portfolios going forward. We believe gold should be viewed as a long-term strategic asset and that investors should carefully consider gold’s potential price drivers today and
beyond.
While the US dollar and interest rates are important factors the frequency of tail risk events, supply/demand dynamics
that drive the price of gold, there are many other variables that and central bank purchases play prominent roles. Regardless
influence the precious metal. Today, the relationship between of the macroeconomic environment, the potential portfolio
gold and market and economic forces is even more complex and diversification benefits of gold remain. As an investment, the
very different from the past. Several other factors including economic forces that determine the price of gold are different
Figure 1: Gold as a Potential Portfolio diversifier
Correlation of Returns to Other Asset
Classes
Bloomberg Commodity Index 0.44
BOFA Merrill Lynch US Corporate Index
0.23
MSCI Emerging Markets Index 0.21
Barclays US Aggregate Index 0.19
MSCI EAFE Index 0.16
BOFA Merrill Lynch US Treasury Index 0.15
Dow Jones US Select Reit Index 0.10
Barclays US HighYield Index 0.08
Russell 2000 Index 0.07
S&P 500 Index -0.01
US 3M Libor (Cash) -0.07
-0.1 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0
Source: State Street Global Advisors (SSGA), Bloomberg, as of 12/31/2015. Computed using monthly return data from Dec 1990 to Dec 2015.
Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and
other income.
Diversification does not ensure a profit or guarantee against loss.
The correlation coefficient measures the strength and direction of a linear relationship between two variables. It measures the degree to which the deviations of one variable from
its mean are related to those of a different variable from its respective mean.
Good as Gold Re-Appraising Strategic Allocations to Gold
Figure 2: Gold as a Tail Risk Hedge — Performance in Market Downturns
%
20
0
-20
-40
-60
-80 Gulf War I LTCM Dot.com 9/11 2002 Great Sovereign Debt
Meltdown Recession Recession Crisis
I
n Gold n MSCI US TR Index
n Commodities n Hedge Funds n Real Estate n Private
Equity n US Treasuries
Source: FactSet, SSGA, from 12/31/1989 to 12/31/2013.
Notes: Persian Gulf War I: Q3 1990, LTCM: Q3 1998, Dot-com Meltdown: Q1 2001, 9/11: Q3 2001, 2002 Recession: Q2/Q3 2002, US Credit Crisis: Q4 2008/Q1 2009, European
Sovereign Debt Crisis: Q2 2010.
Past performance is not a guarantee of future results. Gold
may not serve as a hedge in all market conditions.
Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all
items of income, gain and loss and the reinvestment of dividends and other income.
The correlation coefficient measures the strength and direction of a linear
relationship between two variables. It measures the degree to which the deviations of one variable from its mean are related to those of a different variable from its respective mean.
Indices representing the above asset classes are as follows: Gold = LBMA Afternoon Gold Price as tracked by ICE Benchmark Administration Ltd., Equities = MSCI US TR Index,
Commodities: S&P Goldman Sachs Commodity Index, Hedge Funds = Hedge Fund Research HFRI Fund Weighted Composite Index, Real Estate = Dow Jones US Select REITS Total Return Index, Private Equity = Cambridge Associates Index, US Treasuries =
Barclays Capital US Treasury Aggregate Index.
from the economic forces that determine the price of many Portfolio Diversification
other asset classes such as equities, bonds or commodities. The principle of diversification holds that portfolios benefit
Therefore, gold offers investors a unique opportunity to seek from a wide array of assets that behave differently from one
to diversify portfolios because of its relatively low historical another under various market conditions. The rationale is
correlation with many other asset classes (See Figure 1). simple: Given that it is virtually impossible to know which
So, does it still make sense to invest in gold? We believe the asset classes will do best or how economic developments
answer is a resounding yes. In fact, today, many investors are may impact performance, holding a wide range of assets
reappraising gold’s value and viewing the precious metal not may improve long-term returns and may reduce portfolio
as a temporary and opportunistic holding, but as a unique risk in the long run.
strategic asset class with the potential to diversify and further Although global markets have become more closely
strengthen portfolios in a variety of market conditions. correlated, gold prices have not historically moved in
Whether gold is rallying or weakening, we believe that it’s lockstep with traditional asset classes such as equities and
always appropriate for investors to consider a strategic role xed income. This is because gold prices, again, are influenced
for gold in their portfolios. by different factors than are prices of other assets (see Figure
1 for recent correlations).
Gold’s Strategic Value Therefore, adding a strategic
allocation to gold — anywhere
Over time, holding a modest allocation to gold has offered within the range of 2 percent to 10 percent of the portfolio2
a range of potential portfolio benefits, including: — may help better insulate a portfolio against significant
Low Correlation to Major Asset Classes events that broadly affect the markets.
Reduce
Volatility by Diversifying Portfolios1
• Wealth Preservation (See Figure 2)
State Street Global Advisors
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Good as Gold Re-Appraising Strategic Allocations to Gold
Moderating Volatility in Tumultuous Markets In fact, nearly 60 percent of gold demand comes from jewelry
Gold’s low correlation to other asset classes has been and technology, which are positively tied to factors that may
especially pronounced — and therefore more valuable drive US interest rates higher, such as economic growth and
— during market downturns. lower unemployment.6 And only 6 percent of global gold
As Figure 2 shows, in five out of the seven periods of market demand comes from the US (see Figure 4).
turmoil, an allocation to gold would have preserved wealth in More central bank stimulus in the Eurozone and Japan could
a diversified portfolio by cushioning the hit taken by the potentially lend support to the price of gold should investors
portfolio. Of course, past performance does not guarantee use it as a store of wealth if short-term interest rates remain
future results. negative in countries such as Germany, Switzerland and Japan.
Wealth
Preservation Potential Gold Drivers — Today and Beyond
With heightened uncertainty in today’s complex global market,
making a consistent strategic allocation to gold affords a range Key trends have emerged within some of the primary price
of potential benefits. drivers that may bode well for gold today and in the future.
For
example, gold has been used as a hedge against inflation Those trends include:
for centuries. • Primary Supply Not Meeting Demand
Since 1971, gold has provided an annualized real rate of • Rising Asia Demand
return of 4.2 percent over the US consumer price index (CPI).3
Historically, gold has seen its strongest price performance in • Central Bank Buying
years of high inflation such as in 1980, providing an average • Under-Owned Asset
real return of 19.2 percent and a median increase of 14.9
percent in years in which CPI’s increase has been greater Physical Demand that Exceeds Production
than 5 percent.4 Gold production over the past two decades has averaged
Over at
least these past 45 years, gold has had positive real an annual increase of less than 1 percent. In fact, as of the
returns, giving it value as a long-term
hedge against inflation.5 fourth quarter of 2015, the total supply of gold is down 10
percent from a year earlier because of decreased mining
production and a decline in the recycling of gold.7 Only a
Gold, the US Dollar and Interest
Rates handful of large gold deposits have been discovered over
While the US dollar and interest rates are important factors in the past few decades,
as mine producers face lower gold
explaining the price movement of gold, as mentioned, they are prices and higher production costs. Meanwhile, new
projects
not the sole components. and exploration have slowed. Thus, future production shows
Higher US interest rates may not have a dramatic negative little chance of increasing significantly.
effect on gold due to its complex and global demand dynamics.
Figure 4: Central Bank Net Sales
and Purchases of Gold
Figure 3: Over 50% Of Gold Demand Comes from Asia in Tonnes
Tonnes
800
Asia ex China
USA 9% Europe and India 400
6% 12%
China 0
Middle 8% 29%
East India
25% -400
-800 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Other
11% Source: Metals Focus, World Gold Council, as of 12/31/2015.
Source: Thomson Reuters GFMS, World Gold Council, 2015 annual demand,
as of 12/31/2015.
State Street Global Advisors
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Good as Gold Re-Appraising Strategic Allocations to Gold
Figure 5: Size of Financial Markets
US $160 Trillion; June 30, 2015*
Debt &
Money Market
Gold
51%
1%
Alternative
Investments
5%
Equities
43%
Source: BIS, Thomson Reuters GFMS, Hedge Fund Research, Preqin, World
Federation of Exchange,
World Gold Council. As of June 30, 2015.
* Estimates include the global market capitalization of all publicity traded stocks and
REITs; the total value of outstanding bonds and money market instruments; total
open interest
on major commodity futures plus above ground stocks of precious
metals; the assets under management of private equity and hedge funds; and
private holdings of gold bullion. Central bank holdings of gold and
bonds were excluded.
What Has Happened to the Price of Gold
After reaching a cycle high in 2011, gold prices retreated
by about 45
percent. However, prices have largely been
trading in a consistent range for the past two years.
The 27 percent decline in 2013, while sharp, was
not unprecedented.
Gold has seen seven pullbacks of more
than 10 percent since 2001, and 12 pullbacks of 20 percent
or more since 1970.10 After each decline, gold went on to
not only rebound but to post
new all-time highs. The past
several years have been marked by a confluence of factors
that helped drive gold’s price lower, including fears of
Fed tapering, low inflation
expectations and US dollar
strengthening. While many of these factors remain, with
gold falling in the past four years, the trend, as noted, may
be turning as the economic cycle
matures and new drivers
of gold emerge. Those include:
Gold playing an
effective role as a potential hedge as
stock valuations in the US and elsewhere remain
elevated and as investors have increased risk exposures
in search of returns in a very low
yield environment.
Despite some concerns about gross domestic product
(GDP)
growth across emerging markets, economic
output continues to increase and so do incomes. This,
in turn, strengthens the case for gold as a long-term
strategic asset and potential
wealth preservation tool.
Greater Demand from Expanding Asian Economies
Jewelry represents the largest area of consumption for gold, especially in China and India, where the rising standard of living for all sectors of the population
is increasing the demand for jewelry both for cultural celebrations and as a sign of personal wealth. Physical consumer demand from this region is currently more than five times that of Western markets.
Central Banks Becoming Net Buyers of Gold
In 2010, central banks became net buyers of gold to
reduce their dependence on the US dollar. In fact, central banks bought 588 metric tons of gold in 2015, second only to the record 625 metric tons in 2013.8 That trend is expected to continue over the coming decades, as currency
crises prompt banks to further diversify.
Gold is Under — Owned
In spite of gold’s potential portfolio benefits, gold is still under-owned. As a percentage of total global assets, gold amounted to just 1 percent as of
June 2015, with 70 percent of all investors owning no gold whatsoever.9 However, as investors around the globe come to appreciate gold’s strategic value, pension funds, sovereign wealth funds, insurance funds, mutual funds, hedge funds,
private equity funds and private wealth funds, as well as individual investors, are likely to continue to expand their use of gold as a risk management and capital preservation tool.
A Look Ahead
While history underscores the many benefits of gold as a potentially
“defensive asset” in challenging times, diversification and risk management, along with capital preservation, are attractive attributes in any economic environment. As Ralph Waldo Emerson once observed, “The desire of gold is not
for gold. It is for the means of freedom and benefit.” Although a long period of record-setting prices illustrated gold’s timeless value in times of economic uncertainty, the true “freedom and benefit” gold provides
is in its role as a strategic long-term asset.
1 A byproduct of gold’s low correlation to most key asset classes, such as stocks, bonds and
commodities. Over the past 25 years, the correlation of gold to stocks, bonds and other commodities was -0.01, 0.19, and 0.44, respectively. Source:
SSGA,
Bloomberg, as of 12/31/2015. Computed using monthly return data from Dec
1990 to Dec 2015. It measures the degree to which the deviations of one variable from its
mean are related to those of a different variable from its respective mean.
Index returns are unmanaged and do not reflect the deduction of any fees or expenses.
Stocks represented by S&P 500 Index; Bonds represented by Barclays US Aggregate Index; Commodities represented by Bloomberg Commodity Index. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and other
income.
State Street Global Advisors
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Good as Gold Re-Appraising Strategic Allocations to Gold
2 J.P.Morgan, Gold in asset allocation, July 2012; Mercer, Gold as an asset class 5 Ibid.
for
institutional investors, February 2011; New Frontier Advisors and World Gold 6 Thomson Reuters GFMS, World Gold Council, based on 2014 annual demand,
Council, Gold
as a strategic asset, September 2006; New Frontier Advisors, Gold as as of 12/31/2014.
a strategic asset for European investors, December 2011; Oxford Economics,
The 7 “Gold Demand Trends, Full Year 2015,” World Gold Council.
impact of inflation and deflation in the case for gold, July 2011; Matos, P. and R.
Evans, Gold as a portfolio diversifier: the World Gold Council and investing in gold; 8 “Gold Demand Trends, Full Year 2015,” World Gold Council.
Darden Business Publishing, University of Virginia, September 2012. 9 BIS, Thomson Reuters GFMS, Hedge Fund Research, Preqin, World Federation of
3 World Gold Council, An Investors Guide to the Gold Market US Edition, Exchange, World Gold Council.
December 2010. As quoted in SSGA. The Case for Gold: A Strategic Asset. 10 Bloomberg and SSGA.
4 Ibid.
Figure 6: GLD® Standard Performance
Ticker Fund Name As of 1 Month (%) QTD (%) YTD (%) 1 Year (%) 3 Year (%) 5 Year (%) 10 Year (%) Since Inception (%) 11/18/2004
GLD SPDR Gold Shares NAV 6/30/2016 8.93 6.67 24.10 12.34 3.06 -2.97 7.53 9.44
SPDR Gold Shares
Market Value 6/30/2016 9.03 7.55 24.70 12.59 2.02 -2.82 7.52 9.35
LBMA Gold Price PM 6/30/2016 8.96 6.77 24.60 12.79 3.47 -2.58 7.96 9.88
Source: spdrs.com, as of 6/30/2016.
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.
Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and
other income.
Effective March 20, 2015, the SPDR Gold Trust (GLD) adopted the LBMA Gold Price PM as the reference benchmark price of gold in calculating the
Net Asset Value (NAV) of the Trust. Prior to that date, the Trust used the London PM Fix as the reference benchmark price in calculating the NAV.
Gross Expense
Ratio: 0.40% The gross expense ratio is the fund’s total annual operating expense ratio. It is gross of any fee waivers or expense reimbursements. It can be found in the fund’s most recent prospectus.
State Street Global Advisors
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Good as Gold Re-Appraising Strategic Allocations to Gold
Index Definitions
BofA Merrill Lynch US Corporate Index The BofA Merrill
Lynch US Corporate Index tracks the performance of publicly issued US dollar denominated investment grade corporate debt.
BofA Merrill Lynch US Treasury Index The BofA
Merrill Lynch US Treasury Index tracks
the performance of US dollar denominated sovereign debt publicly issued by the US government.
Barclays Capital US Treasury Index US
dollar-denominated, fixed-rate, nominal debt issued by the US Treasury. Treasury bills are excluded by the maturity constraint, but are part of a separate Short Treasury Index.
Barclays Global Aggregate Bond Index The Barclays Global
Aggregate Index provides a
broad-based measure of the global investment-grade fixed income markets. The three major components of this index are the U.S. Aggregate, the Pan-European Aggregate, and the Asian-Pacific Aggregate Indices. The index also includes
Eurodollar and Euro-Yen corporate bonds, Canadian government, agency and corporate securities, and USD investment grade 144A securities.
Barclays U.S. High Yield Corporate Bond Index The
Barclays U.S. High Yield
Index covers the universe of fixed rate, non-investment grade debt. Eurobonds and debt issues from countries designated as emerging markets (sovereign rating of Baa1/BBB+/BBB+ and below using the middle of Moody’s, S&P, and Fitch) are
excluded, but Canadian and global bonds (SEC registered) of issuers in non-EMG countries are included. The index includes both corporate and non-corporate sectors.
Bloomberg Commodity Index A broadly diversified commodity price index distributed by Bloomberg Indexes that tracks 22 commodity futures and seven sectors. No
one commodity can compose less than 2 percent or more than 15 percent of the index and no sector can represent more than 33 percent of the index.
Cambridge Associates Private Equity Index A benchmark based on returns data compiled on U.S. private equity funds, including fully liquidated partnerships, formed between 1986 and
2014.
Dow Jones US Select REIT Index A benchmark of U.S.
REITs and REIT-like
securities that screens for market capitalization, liquidity and percentage of revenue derived from ownership and operation of real estate securities. It is fioat market cap weighted and quoted in dollars.
Dow Jones US Select REITs Total Return Index
A benchmark of U.S. REITs and REIT-like
securities that screens for market capitalization, liquidity and percentage of revenue derived from ownership and operation of real estate securities. It is float market cap weighted, quoted in dollars and reflects reinvested
dividends.
HFRI Fund Weighted Composite Index A global, equal-weighted index of over 2,000 single-manager funds that report to Hedge Fund Research Inc.’s
database. The HFRI Fund Weighted Composite Index does not include Funds of Hedge Funds.
LBMA Afternoon Gold Price The LBMA Gold Price is determined
twice each business day (10:30 a.m. and 3:00 p.m. London time) by the participants in a physically settled, electronic and tradable auction.
MSCI EAFE Index
An equities benchmark that captures large- and mid-cap representation across developed market countries around the world, excluding the U.S. and Canada.
MSCI
Emerging Markets Index The MSCI Emerging
Markets Index captures large and mid-cap representation across 23 emerging markets countries. With 834 constituents, the
index covers approximately 85% of the free float-adjusted market capitalization in each country.
MSCI USA Total Return Index The MSCI USA Total
Return Index is designed to measure the performance of the large and mid-cap segments of the US market, with dividends reinvested. With 631 constituents,
the index covers approximately 85 percent of the free float-adjusted market capitalization in the US.
Russell 2000 Index A benchmark that measures
theperformance of the small-cap segment of the U.S. equity universe.
S&P 500 Index A popular benchmark for U.S. large-cap equities thatxincludes 500 companies
from leading industries and captures approximately 80 percent coverage of available market capitalization.
S&P Goldman Sachs Commodity Index, or S&P GSCI
A production-weighted index launched in 1992 that tracks the performance of 24 commodity futures contracts. The index, tilts to commodities that
are moreheavily produced globally, so its weights more heavily to, say, crude oil than to cocoa. US 3-Month Libor (Cash) Libor, or the London Interbank Offered Rate, is equivalent to the federal funds rate, or the interest rate
one bank charges another for a loan. It is used as a reference figure for corporate financial transactions and, increasingly, for consumer loans as well.
State Street Global Advisors
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Good as Gold Re-Appraising Strategic Allocations to Gold
ssga.com | spdrs.com
For public use.
State Street Global Advisors One Lincoln Street, Boston, MA 02111-2900. T: +1 866 787 2257.
Important Risk Information
ETFs trade like stocks, are subject to investment
risk, fluctuate in market value and may trade at prices above or below the ETFs’ net asset value. Brokerage commissions and ETF expenses will reduce returns.
Diversification does not ensure a profit or guarantee against loss.
Commodities and commodity-index linked securities may be affected by changes in overall market movements, changes in interest rates, and other factors such as
weather, disease, embargoes, or political and regulatory developments, as well as trading activity of speculators and arbitrageurs in the underlying commodities.
While the shares of ETFs are tradable on secondary markets, they may not readily trade in all market conditions and may trade at significant discounts in periods
of market stress.
The views expressed in this material are the views of Intermediary Business Group through the period ended December 31, 2015 and are subject
to change based on market and other conditions. This document contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or
developments may differ materially from those projected.
The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents
disclosed to third parties without SSGA’s express written consent. Standard & Poor’s®, S&P® and SPDR® are registered trademarks of Standard & Poor’s Financial Services LLC (S&P); Dow Jones is a
registered 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 for certain purposes by State Street Corporation. State Street
Corporation’s financial products are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates and third party licensors and none of such parties make any representation regarding the advisability of
investing in such product(s) nor do they have any liability in relation thereto, including for any errors, omissions, or interruptions of any index.
The gross
expense ratio is the fund’s total annual operating expense ratio. It is gross of any fee waivers or expense reimbursements. It can be found in the fund’s most recent prospectus. Past performance is not a guarantee of future results.
Investing in commodities entails significant risk and is not appropriate for all investors.
Important Information Relating to SPDR Gold Trust (“GLD®”): The SPDR Gold Trust (“GLD®”) has filed a registration statement (including a prospectus)
with the Securities and Exchange Commission (“SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents
GLD has filed with the SEC for more complete information about GLD and this offering. You may get these documents for free by visiting EDGAR on the SEC website at sec.gov or by
visiting spdrgoldshares.com.
Alternatively, the SPDR Gold Trust or any authorized participant will arrange to send you the prospectus if you request it by calling
866.320.4053.
GLD is not an investment company registered under the Investment Company Act of
1940 (the “1940 Act”) and is not subject to regulation under the Commodity Exchange Act of 1936 (the “CEA”). As a result, shareholders of the Trust do not have
the protections associated with ownership of shares in an investment company registered under the 1940 Act or the protections afforded by the CEA. GLD shares trade like stocks, are subject to investment risk and will fluctuate in market value. The
value of GLD shares relates directly to the value of the gold held 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 shares,
which trade at market price, may be more or less than the value of the gold represented by them. GLD does not generate any income, and as GLD regularly sells gold to pay for its ongoing expenses, the amount of gold represented by each Share will
decline over time. Investing involves risk, and you could lose money on an investment in GLD. Please see the GLD prospectus for a detailed discussion of the risks of investing in GLD shares. The GLD prospectus is available here. The World Gold
Council name and logo are a registered trademark and used with the permission of the World Gold Council pursuant to a license agreement. The World Gold Council is not responsible for the content of, and is not liable for the use of or reliance on,
this material.
For more information: State Street Global Markets, LLC, One Lincoln Street,
Boston, MA, 02111 T: +1 866 320 4053 spdrgoldshares.com.
Not FDIC Insured • No Bank
Guarantee • May Lose Value
State Street Global Advisors
© 2016
State Street Corporation. All Rights Reserved.
ID7099-IBG-20094 0716 Exp. Date: 10/31/2016
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 Markets, LLC, One Lincoln Street, Attn: SPDR® Gold Shares, 30th Floor, Boston, MA 02111.