Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 07, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Aberdeen Standard Palladium ETF Trust | |
Entity Central Index Key | 1,459,862 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | pall | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 1,400,000 |
Statements of Assets and Liabil
Statements of Assets and Liabilities - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 | |
ASSETS | |||
Investment in palladium (cost: September 30, 2018: $94,652; December 31, 2017: $155,318) | $ 145,394,000 | $ 241,679,000 | |
Total assets | 145,394,000 | 241,679,000 | |
LIABILITIES | |||
Fees payable to Sponsor | 71,899 | 124,409 | |
Total Liabilities | 72,000 | 124,000 | |
Net assets | [1] | $ 145,322,000 | $ 241,555,000 |
[1] | Authorized share capital is unlimited with no par value per Share. Shares issued and outstanding at September 30, 2018 were 1,400,000 and at December 31, 2017 were 2,400,000. Net asset values per Share at September 30, 2018 and December 31, 2017 were $103.80 and $100.65, respectively. |
Statements of Assets and Liab_2
Statements of Assets and Liabilities (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Statements of Assets and Liabilities [Abstract] | ||
Investment in palladium at cost | $ 94,652 | $ 155,318 |
Common stock, shares authorized | Unlimited | Unlimited |
Common stock, par value | $ 0 | $ 0 |
Common stock, shares issued | 1,400,000 | 2,400,000 |
Common stock, shares outstanding | 1,400,000 | 2,400,000 |
Net asset value per share | $ 103.80 | $ 100.65 |
Schedules of Investments
Schedules of Investments $ in Thousands | Sep. 30, 2018USD ($)oz | Dec. 31, 2017USD ($)oz | |
Investment Holdings [Line Items] | |||
Investment in palladium (oz) | oz | 132,901.1 | 228,863.1 | |
Cost | $ 94,652 | $ 155,318 | |
Fair Value | $ 145,394 | $ 241,679 | |
% of Net Assets | 100.05% | 100.05% | |
Less liabilities | $ (72) | $ (124) | |
Less liabilities, % of Net Assets | (0.05%) | (0.05%) | |
Net assets | [1] | $ 145,322 | $ 241,555 |
Net assets, % of Net Assets | 100.00% | 100.00% | |
Palladium [Member] | |||
Investment Holdings [Line Items] | |||
Investment in palladium (oz) | oz | 132,901.1 | 228,863.1 | |
Cost | $ 94,652 | $ 155,318 | |
Fair Value | $ 145,394 | $ 241,679 | |
% of Net Assets | 100.05% | 100.05% | |
[1] | Authorized share capital is unlimited with no par value per Share. Shares issued and outstanding at September 30, 2018 were 1,400,000 and at December 31, 2017 were 2,400,000. Net asset values per Share at September 30, 2018 and December 31, 2017 were $103.80 and $100.65, respectively. |
Statements of Operations
Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
EXPENSES | ||||
Sponsor's Fee | $ 210,347 | $ 329,748 | $ 842,359 | $ 922,997 |
Total expenses | 210,000 | 330,000 | 842,000 | 923,000 |
Net investment loss | (210,000) | (330,000) | (842,000) | (923,000) |
REALIZED AND UNREALIZED GAINS / (LOSSES) | ||||
Realized gain on palladium transferred to pay expenses | 52,000 | 78,000 | 268,000 | 166,000 |
Realized gain on palladium distributed for the redemption of Shares | 3,914,000 | 1,865,000 | 30,150,000 | 8,318,000 |
Change in unrealized gain / (loss) on investment in palladium | 14,111,000 | 20,188,000 | (35,619,000) | 54,846,000 |
Total gain / (loss) on investment in palladium | 18,077,000 | 22,131,000 | (5,201,000) | 63,330,000 |
Change in net assets from operations | $ 17,867,000 | $ 21,801,000 | $ (6,043,000) | $ 62,407,000 |
Net increase / (decrease) in net assets per Share | $ 12.11 | $ 8.71 | $ (3.08) | $ 24.09 |
Weighted average number of Shares (in Shares) | 1,475,000 | 2,503,804 | 1,961,905 | 2,590,110 |
Statements of Changes in Net As
Statements of Changes in Net Assets - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Statements of Changes in Net Assets [Abstract] | ||||
Opening balance (in Shares) | 2,400,000 | 2,750,000 | 2,750,000 | |
Creations (in Shares) | 250,000 | 450,000 | ||
Redemptions (in Shares) | (1,250,000) | (800,000) | ||
Closing balance (in Shares) | 1,400,000 | 1,400,000 | 2,400,000 | |
Opening balance | $ 241,555 | $ 178,252 | $ 178,252 | |
Net investment loss | $ (210) | (842) | (923) | (1,278) |
Realized gain on investment in palladium | 30,418 | 14,603 | ||
Change in unrealized gain/(loss) on investment in palladium | 14,111 | (35,619) | $ 54,846 | 77,205 |
Creations | 24,277 | 37,402 | ||
Redemptions | (114,467) | (64,629) | ||
Closing balance | $ 145,322 | $ 145,322 | $ 241,555 |
Financial Highlights
Financial Highlights - $ / shares | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Per Share Performance (for a Share outstanding throughout the entire period) | |||||
Net asset value per Share at beginning of period | $ 90.56 | $ 80.40 | $ 100.65 | $ 64.82 | |
Income from investment operations: | |||||
Net investment loss | (0.14) | (0.13) | (0.43) | (0.36) | |
Total realized and unrealized gains or losses on investment in palladium | 13.38 | 8.98 | 3.58 | 24.79 | |
Change in net assets from operations | 13.24 | 8.85 | 3.15 | 24.43 | |
Net asset value per Share at end of period | $ 103.80 | $ 89.25 | $ 103.80 | $ 89.25 | |
Weighted average number of shares | 1,475,000 | 2,503,804 | 1,961,905 | 2,590,110 | |
Expense ratio | [1] | 0.60% | 0.60% | 0.60% | 0.60% |
Net investment loss ratio | [1] | (0.60%) | (0.60%) | (0.60%) | (0.60%) |
Total return, at net asset value | [2] | 14.62% | 11.01% | 3.13% | 37.69% |
[1] | Annualized for periods of less than one year. | ||||
[2] | Total return is not annualized. |
Organization
Organization | 9 Months Ended |
Sep. 30, 2018 | |
Organization [Abstract] | |
Organization | 1. Organization The Aberdeen Standard Palladium ETF Trust (the “Trust”), formerly known as ETFS Palladium Trust prior to October 1, 2018, is an investment trust formed on December 30, 2009 (the “Date of Inception”), under New York law pursuant to a depositary trust agreement (the “Trust Agreement”) executed by Aberdeen Standard Investments ETFs Sponsor LLC (the “Sponsor”), formerly known as ETF Securities USA LLC prior to October 1, 2018, and The Bank of New York Mellon as Trustee (the “Trustee”) at the time of the Trust’s organization. The Trust holds palladium bullion and issues Aberdeen Standard Physical Palladium Shares ETF (“Shares”), formerly known as ETFS Physical Palladium Shares prior to October 1, 2018, (in minimum blocks of 50,000 Shares, also referred to as “Baskets”) in exchange for deposits of palladium and distributes palladium in connection with the redemption of Baskets. Shares represent units of fractional undivided beneficial interest in and ownership of the Trust which are issued by the Trust. The Sponsor is a Delaware limited liability company. Prior to April 27, 2018, the Sponsor was wholly-owned by ETF Securities Limited, a Jersey, Channel Islands based company. Effective April 27, 2018, ETF Securities Limited sold its membership interest in the Sponsor to Aberdeen Asset Management Inc. (“AAMI”), a Delaware corporation. As a result of the sale, AAMI became the sole member of the Sponsor. AAMI is a wholly-owned indirect subsidiary of Standard Life Aberdeen plc. The Trust is governed by the Trust Agreement. The investment objective of the Trust is for the Shares to reflect the performance of the price of palladium, less the Trust’s expenses and liabilities. The Trust is designed to provide an individual owner of beneficial interests in the Shares (a “Shareholder”) an opportunity to participate in the palladium market through an investment in securities. The fiscal year end for the Trust is December 31. The accompanying financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q. In the opinion of the Trust’s management, all adjustments (which consist of normal recurring adjustments) necessary to present fairly the financial position and results of operations as of and for the three and nine months ended September 30, 2018 and 2017 and for all periods presented have been made. These financial statements should be read in conjunction with the Trust’s Annual Report on Form 10-K and 10-K/A for the fiscal year ended December 31, 2017 . The results of operations for the three and nine months ended September 30, 2018 are not necessarily indicative of the operating results for the full year. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies The preparation of financial statements in accordance with U.S. GAAP requires those responsible for preparing financial statements to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Trust. 2.1. Basis of Accounting The Sponsor has determined that the Trust falls within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services—Investment Companies, and has concluded that for reporting purposes, the Trust is classified as an Investment Company. The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. 2.2. Valuation of Palladium The Trust follows the provisions of ASC 820, Fair Value Measurements (“ASC 820”). ASC 820 provides guidance for determining fair value and requires increased disclosure regarding the inputs to valuation techniques used to measure fair value. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Palladium is held by JPMorgan Chase Bank, N.A. (the “Custodian”), on behalf of the Trust, at its London, England vaulting premises. Palladium may also be held by UBS AG, or any other firm selected by the Custodian to hold the Trust’s palladium in the Trust’s allocated account in the firm’s Zurich, Switzerland vault premises on a segregated basis and whose appointment has been approved by the Sponsor (the “Zurich Sub-Custodian”). At September 30, 2018 , approximately 59% of the Trust’s palladium was held by the Zurich Sub-Custodian. Palladium is recorded at fair value. The cost of palladium is determined according to the average cost method and the fair value is based on the afternoon session of the twice daily fix of an ounce of palladium administered by the London Metal Exchange (“LME”) (the “LME PM Fix”). Realized gains and losses on transfers of palladium, or palladium distributed for the redemption of Shares, are calculated on a trade date basis as the difference between the fair value and cost of palladium transferred. The LME is responsible for the administration of the electronic palladium price fixing system (“LMEbullion”) that replicates electronically the manual London palladium fix processes previously employed by the London Platinum and Palladium Fixing Company Ltd (“LPPFCL”), as well as providing electronic market clearing processes for palladium bullion transactions at the fixed prices established by the LME pricing mechanism. LMEbullion, like the previous London palladium fix processes, establishes and publishes fixed prices for troy ounces of palladium twice each London trading day during fixing sessions beginning at 9:45 a.m. London time (the” LME AM Fix”) and 2:00 p.m. London time (the “LME PM Fix”). Once the value of palladium has been determined, the Net Asset Value (the “NAV”) is computed by the Trustee by deducting all accrued fees, expenses and other liabilities of the Trust, including the remuneration due to the Sponsor (the “Sponsor’s Fee”), from the fair value of the palladium and all other assets held by the Trust. The Trust recognizes changes in fair value of the investment in palladium as changes in unrealized gains or losses on investment in palladium through the Statement of Operations. The per Share amount of palladium exchanged for a purchase or redemption is calculated daily by the Trustee, using the LME PM Fix to calculate the palladium amount in respect of any liabilities for which covering palladium sales have not yet been made, and represents the per Share amount of palladium held by the Trust, after giving effect to its liabilities, to cover expenses and liabilities and any losses that may have occurred. 2.2. Valuation of Palladium (continued) Fair Value Hierarchy ASC 820 establishes a hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. Level 2 Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments and similar data. Level 3 Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the Trust’s own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The investment in palladium is classified as a level 2 asset, as the fair value of the Trust’s investment in palladium is calculated based upon third party pricing sources supported by observable, verifiable inputs. The categorization of the Trust’s assets is as shown below: (Amounts in 000's of US$) September 30, 2018 December 31, 2017 Level 2 Investment in palladium $ 145,394 $ 241,679 There were no transfers between levels during the nine months ended September 30, 2018 , or the year ended December 31, 2017 . 2.3. Palladium Receivable and Payable Palladium receivable or payable represents the quantity of palladium covered by contractually binding orders for the creation or redemption of Shares respectively, where the palladium has not yet been transferred to or from the Trust’s account. Generally, for all orders accepted prior to September 5, 2017, ownership of palladium is transferred within three business days of the trade date, and for all orders accepted on or after September 5, 2017, ownership of palladium is transferred within two business days of the trade date. At September 30, 2018 , the Trust had no palladium receivable or payable for the creation or redemption of Shares. 2.4. Creations and Redemptions of Shares The Trust expects to create and redeem Shares from time to time, but only in one or more Baskets (a Basket equals a block of 50,000 Shares). The Trust issues Shares in Baskets to Authorized Participants on an ongoing basis. Individual investors cannot purchase or redeem Shares in direct transactions with the Trust. An Authorized Participant is a person who (1) is a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions, (2) is a participant in The Depository Trust Company, (3) has entered into an Authorized Participant Agreement with the Trustee and the Sponsor, and (4) has established an Authorized Participant Unallocated Account with the Trust’s Custodian or other palladium bullion clearing bank. An Authorized Participant Agreement is an agreement entered into by each Authorized Participant, the Sponsor and the Trustee which provides the procedures for the creation and redemption of Baskets and for the delivery of the palladium and any cash required for such creations and redemptions. An Authorized Participant Unallocated Account is an unallocated palladium account, either loco London or loco Zurich, established with the Custodian or a palladium bullion clearing bank by an Authorized Participant. The creation and redemption of Baskets is only made in exchange for the delivery to the Trust or the distribution by the Trust of the amount of palladium represented by the Baskets being created or redeemed, the amount of which is based on the combined NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received. Authorized Participants may, on any business day, place an order with the Trustee to create or redeem one or more Baskets. Effective as of September 5, 2017, the typical settlement period for Shares is two business days. Prior to September 5, 2017, the typical settlement period for Shares was three business days. In the event of a trade date at period end, where a settlement is pending, a respective account receivable and/or payable will be recorded. When palladium is exchanged in settlement of a redemption, it is considered a sale of palladium for financial statement purposes. The amount of palladium represented by the Baskets created or redeemed can only be settled to the nearest 1/1000 th of an ounce. As a result, the value attributed to the creation or redemption of Shares may differ from the value of palladium to be delivered or distributed by the Trust. In order to ensure that the correct amount of palladium is available at all times to back the Shares, the Sponsor accepts an adjustment to its management fees in the event of any shortfall or excess on each transaction. For each transaction, this amount is not more than 1/1000 th of an ounce of palladium. As the Shares of the Trust are subject to redemption at the option of Authorized Participants, the Trust has classified the Outstanding Shares as Net Assets. Changes in the number of Shares outstanding are presented in the Statement of Changes in Net Assets. 2.5. Income Taxes The Trust is classified as a “grantor trust” for U.S. federal income tax purposes. As a result, the Trust itself will not be subject to U.S. federal income tax. Instead, the Trust’s income and expenses will “flow through” to the Shareholders, and the Trustee will report the Trust’s proceeds, income, deductions, gains, and losses to the Internal Revenue Service on that basis. The Sponsor has evaluated whether or not there are uncertain tax positions that require financial statement recognition and has determined that no reserves for uncertain tax positions are required as of September 30, 2018 and December 31, 2017 . 2.6. Investment in Palladium Changes in ounces of palladium and their respective values for the nine months ended September 30, 2018 and for the year ended December 31, 2017 are set out below: Nine Months Year Ended Ended (Amounts in 000's of US$, except for ounces data) September 30, 2018 December 31, 2017 Ounces of palladium Opening balance 228,863.1 263,819.3 Creations 23,800.7 43,021.8 Redemptions (118,869.0) (76,489.4) Transfers of palladium to pay expenses (893.7) (1,488.6) Closing balance 132,901.1 228,863.1 Investment in palladium Opening balance $ 241,679 $ 178,342 Creations 24,277 37,402 Redemptions (114,467) (64,629) Realized gain on palladium distributed for the redemption of Shares 30,150 14,337 Transfers of palladium to pay expenses (894) (1,244) Realized gain on palladium transferred to pay expenses 268 266 Change in unrealized (loss) / gain on investment in palladium (35,619) 77,205 Closing balance $ 145,394 $ 241,679 2.7. Expenses / Realized Gains / Losses The primary expense of the Trust is the Sponsor’s Fee, which is paid by the Trust through in-kind transfers of palladium to the Sponsor. The Trust will transfer palladium to the Sponsor to pay the Sponsor’s Fee that will accrue daily at an annualized rate equal to 0.60 % of the adjusted net asset value (“ANAV”) of the Trust, paid monthly in arrears. The Sponsor has agreed to assume administrative and marketing expenses incurred by the Trust, including the Trustee’s monthly fee and out of pocket expenses, the Custodian’s fee and the reimbursement of the Custodian’s expenses, exchange listing fees, United States Securities and Exchange Commission (the “SEC”) registration fees, printing and mailing costs, audit fees and certain legal expenses. For the three months ended September 30, 2018 and 2017 , the Sponsor’s Fee was $ 210,347 and $ 329,748 , respectively. For the nine months ended September 30, 2018 and 2017 , the Sponsor’s Fee was $ 842,359 and $ 922,997 , respectively. At September 30, 2018 and at December 31, 2017 , the fees payable to the Sponsor were $ 71,899 and $ 124,409 , respectively. With respect to expenses not otherwise assumed by the Sponsor, the Trustee will, at the direction of the Sponsor or in its own discretion, sell the Trust’s palladium as necessary to pay these expenses. When selling palladium to pay expenses, the Trustee will endeavor to sell the smallest amounts of palladium needed to pay these expenses in order to minimize the Trust’s holdings of assets other than palladium. Other than the Sponsor’s Fee, the Trust had no expenses during the three and nine months ended September 30, 2018 and 2017 . Unless otherwise directed by the Sponsor, when selling palladium the Trustee will endeavor to sell at the price established by the LME PM Fix. The Trustee will place orders with dealers (which may include the Custodian) through which the Trustee expects to receive the most favorable price and execution of orders. The Custodian may be the purchaser of such palladium only if the sale transaction is made at the next LME PM Fix or such other publicly available price that the Sponsor deems fair, in each case as set following the sale order. A gain or loss is recognized based on the difference between the selling price and the cost of the palladium sold. Neither the Trustee nor the Sponsor is liable for depreciation or loss incurred by reason of any sale. Realized gains and losses result from the transfer of palladium for Share redemptions and / or to pay expenses and are recognized on a trade date basis as the difference between the fair value and cost of palladium transferred. 2.8. Subsequent Events In accordance with the provisions set forth in FASB ASC 855-10, Subsequent Events , the Trust’s management has evaluated the possibility of subsequent events impacting the Trust’s financial statements through the filing date. During this period, no material subsequent events requiring adjustment to or disclosure in the financial statements were identified other than the following: Effective October 1, 2018, the name of the Trust changed from ETFS Palladium Trust to Aberdeen Standard Palladium ETF Trust, and the name of the Shares issuable by the Trust changed from ETFS Physical Palladium Shares to Aberdeen Standard Physical Palladium Shares ETF. In addition, the name of the Trust’s Sponsor changed from ETF Securities USA LLC to Aberdeen Standard Investments ETFs Sponsor LLC. In connection with the Trust’s name change, the Trust’s CUSIP number changed to 003262102. In October 2018, the SEC posted to the Federal Register their Final Rule Release No. 33-10532 , Disclosure Update and Simplification Rule (the “Rule”) which has an effective date of November 5, 2018. The Sponsor has evaluated the effect that the Rule will have on the Trust’s 10-Q and has determined that the Rule will not have a significant impact on the presentation or disclosures in the Trust’s September 30, 2018 10-Q. The Sponsor has elected to forego the changes for the current interim reporting period, and will adopt the changes in the Trust’s 10-Q for the period ended March 31, 2019. |
Related Parties
Related Parties | 9 Months Ended |
Sep. 30, 2018 | |
Related Parties [Abstract] | |
Related Parties | 3. Related Parties The Sponsor and the Trustee are considered to be related parties to the Trust. The Trustee’s and Custodian’s fees are paid by the Sponsor and are not separate expenses of the Trust. The Trustee and the Custodian and their affiliates may from time to time act as Authorized Participants, and purchase or sell Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion. In addition the Trustee and the Custodian and their affiliates may from time to time purchase or sell palladium directly, for their own account, as agent for their customers and for accounts over which they exercise investment discretion. |
Concentration Of Risk
Concentration Of Risk | 9 Months Ended |
Sep. 30, 2018 | |
Concentration Of Risk [Abstract] | |
Concentration Of Risk | 4. Concentration of Risk The Trust’s sole business activity is the investment in palladium and substantially all the Trust’s assets are holdings of palladium, which creates a concentration of risk associated with fluctuations in the price of palladium. Several factors could affect the price of palladium, including: (i) global palladium supply and demand, which is influenced by such factors as production and cost levels in major palladium-producing countries, recycling, autocatalyst demand, industrial demand, jewelry demand, investment demand. Sales of existing stockpiles of palladium have been a key source of supply and are likely to be exhausted soon, placing a higher burden on new mine supply; (ii) investors’ expectations with respect to the rate of inflation; (iii) currency exchange rates; (iv) interest rates; (v) investment and trading activities of hedge funds and commodity funds; and (vi) global or regional political, economic or financial events and situations. In addition, there is no assurance that palladium will maintain its long-term value in terms of purchasing power in the future. In the event that the price of palladium declines, the Sponsor expects the value of an investment in the Shares to decline proportionately. Each of these events could have a material effect on the Trust’s financial position and results of operations. |
Indemnification
Indemnification | 9 Months Ended |
Sep. 30, 2018 | |
Indemnification [Abstract] | |
Indemnification | 5. Indemnification Under the Trust’s organizational documents, the Trustee (and its directors, employees and agents) and the Sponsor (and its members, managers, directors, officers, employees and affiliates) are indemnified by the Trust against any liability, cost or expense it incurs without gross negligence, bad faith, willful misconduct or willful malfeasance on its part and without reckless disregard on its part of its obligations and duties under the Trust’s organizational documents. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. |
Significant Accounting Polici_2
Significant Accounting Policies (Policy) | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Basis Of Accounting | 2.1. Basis of Accounting The Sponsor has determined that the Trust falls within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services—Investment Companies, and has concluded that for reporting purposes, the Trust is classified as an Investment Company. The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. |
Valuation Of Palladium | 2.2. Valuation of Palladium The Trust follows the provisions of ASC 820, Fair Value Measurements (“ASC 820”). ASC 820 provides guidance for determining fair value and requires increased disclosure regarding the inputs to valuation techniques used to measure fair value. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Palladium is held by JPMorgan Chase Bank, N.A. (the “Custodian”), on behalf of the Trust, at its London, England vaulting premises. Palladium may also be held by UBS AG, or any other firm selected by the Custodian to hold the Trust’s palladium in the Trust’s allocated account in the firm’s Zurich, Switzerland vault premises on a segregated basis and whose appointment has been approved by the Sponsor (the “Zurich Sub-Custodian”). At September 30, 2018 , approximately 59% of the Trust’s palladium was held by the Zurich Sub-Custodian. Palladium is recorded at fair value. The cost of palladium is determined according to the average cost method and the fair value is based on the afternoon session of the twice daily fix of an ounce of palladium administered by the London Metal Exchange (“LME”) (the “LME PM Fix”). Realized gains and losses on transfers of palladium, or palladium distributed for the redemption of Shares, are calculated on a trade date basis as the difference between the fair value and cost of palladium transferred. The LME is responsible for the administration of the electronic palladium price fixing system (“LMEbullion”) that replicates electronically the manual London palladium fix processes previously employed by the London Platinum and Palladium Fixing Company Ltd (“LPPFCL”), as well as providing electronic market clearing processes for palladium bullion transactions at the fixed prices established by the LME pricing mechanism. LMEbullion, like the previous London palladium fix processes, establishes and publishes fixed prices for troy ounces of palladium twice each London trading day during fixing sessions beginning at 9:45 a.m. London time (the” LME AM Fix”) and 2:00 p.m. London time (the “LME PM Fix”). Once the value of palladium has been determined, the Net Asset Value (the “NAV”) is computed by the Trustee by deducting all accrued fees, expenses and other liabilities of the Trust, including the remuneration due to the Sponsor (the “Sponsor’s Fee”), from the fair value of the palladium and all other assets held by the Trust. The Trust recognizes changes in fair value of the investment in palladium as changes in unrealized gains or losses on investment in palladium through the Statement of Operations. The per Share amount of palladium exchanged for a purchase or redemption is calculated daily by the Trustee, using the LME PM Fix to calculate the palladium amount in respect of any liabilities for which covering palladium sales have not yet been made, and represents the per Share amount of palladium held by the Trust, after giving effect to its liabilities, to cover expenses and liabilities and any losses that may have occurred. 2.2. Valuation of Palladium (continued) Fair Value Hierarchy ASC 820 establishes a hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. Level 2 Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments and similar data. Level 3 Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the Trust’s own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The investment in palladium is classified as a level 2 asset, as the fair value of the Trust’s investment in palladium is calculated based upon third party pricing sources supported by observable, verifiable inputs. The categorization of the Trust’s assets is as shown below: (Amounts in 000's of US$) September 30, 2018 December 31, 2017 Level 2 Investment in palladium $ 145,394 $ 241,679 There were no transfers between levels during the nine months ended September 30, 2018 , or the year ended December 31, 2017 . |
Palladium Receivable And Payable | 2.3. Palladium Receivable and Payable Palladium receivable or payable represents the quantity of palladium covered by contractually binding orders for the creation or redemption of Shares respectively, where the palladium has not yet been transferred to or from the Trust’s account. Generally, for all orders accepted prior to September 5, 2017, ownership of palladium is transferred within three business days of the trade date, and for all orders accepted on or after September 5, 2017, ownership of palladium is transferred within two business days of the trade date. |
Creations And Redemptions Of Shares | 2.4. Creations and Redemptions of Shares The Trust expects to create and redeem Shares from time to time, but only in one or more Baskets (a Basket equals a block of 50,000 Shares). The Trust issues Shares in Baskets to Authorized Participants on an ongoing basis. Individual investors cannot purchase or redeem Shares in direct transactions with the Trust. An Authorized Participant is a person who (1) is a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions, (2) is a participant in The Depository Trust Company, (3) has entered into an Authorized Participant Agreement with the Trustee and the Sponsor, and (4) has established an Authorized Participant Unallocated Account with the Trust’s Custodian or other palladium bullion clearing bank. An Authorized Participant Agreement is an agreement entered into by each Authorized Participant, the Sponsor and the Trustee which provides the procedures for the creation and redemption of Baskets and for the delivery of the palladium and any cash required for such creations and redemptions. An Authorized Participant Unallocated Account is an unallocated palladium account, either loco London or loco Zurich, established with the Custodian or a palladium bullion clearing bank by an Authorized Participant. The creation and redemption of Baskets is only made in exchange for the delivery to the Trust or the distribution by the Trust of the amount of palladium represented by the Baskets being created or redeemed, the amount of which is based on the combined NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received. Authorized Participants may, on any business day, place an order with the Trustee to create or redeem one or more Baskets. Effective as of September 5, 2017, the typical settlement period for Shares is two business days. Prior to September 5, 2017, the typical settlement period for Shares was three business days. In the event of a trade date at period end, where a settlement is pending, a respective account receivable and/or payable will be recorded. When palladium is exchanged in settlement of a redemption, it is considered a sale of palladium for financial statement purposes. The amount of palladium represented by the Baskets created or redeemed can only be settled to the nearest 1/1000 th of an ounce. As a result, the value attributed to the creation or redemption of Shares may differ from the value of palladium to be delivered or distributed by the Trust. In order to ensure that the correct amount of palladium is available at all times to back the Shares, the Sponsor accepts an adjustment to its management fees in the event of any shortfall or excess on each transaction. For each transaction, this amount is not more than 1/1000 th of an ounce of palladium. As the Shares of the Trust are subject to redemption at the option of Authorized Participants, the Trust has classified the Outstanding Shares as Net Assets. Changes in the number of Shares outstanding are presented in the Statement of Changes in Net Assets. |
Income Taxes | 2.5. Income Taxes The Trust is classified as a “grantor trust” for U.S. federal income tax purposes. As a result, the Trust itself will not be subject to U.S. federal income tax. Instead, the Trust’s income and expenses will “flow through” to the Shareholders, and the Trustee will report the Trust’s proceeds, income, deductions, gains, and losses to the Internal Revenue Service on that basis. The Sponsor has evaluated whether or not there are uncertain tax positions that require financial statement recognition and has determined that no reserves for uncertain tax positions are required as of September 30, 2018 and December 31, 2017 . |
Investment In Palladium | 2.6. Investment in Palladium Changes in ounces of palladium and their respective values for the nine months ended September 30, 2018 and for the year ended December 31, 2017 are set out below: Nine Months Year Ended Ended (Amounts in 000's of US$, except for ounces data) September 30, 2018 December 31, 2017 Ounces of palladium Opening balance 228,863.1 263,819.3 Creations 23,800.7 43,021.8 Redemptions (118,869.0) (76,489.4) Transfers of palladium to pay expenses (893.7) (1,488.6) Closing balance 132,901.1 228,863.1 Investment in palladium Opening balance $ 241,679 $ 178,342 Creations 24,277 37,402 Redemptions (114,467) (64,629) Realized gain on palladium distributed for the redemption of Shares 30,150 14,337 Transfers of palladium to pay expenses (894) (1,244) Realized gain on palladium transferred to pay expenses 268 266 Change in unrealized (loss) / gain on investment in palladium (35,619) 77,205 Closing balance $ 145,394 $ 241,679 |
Expenses / Realized Gains / Losses | 2.7. Expenses / Realized Gains / Losses The primary expense of the Trust is the Sponsor’s Fee, which is paid by the Trust through in-kind transfers of palladium to the Sponsor. The Trust will transfer palladium to the Sponsor to pay the Sponsor’s Fee that will accrue daily at an annualized rate equal to 0.60 % of the adjusted net asset value (“ANAV”) of the Trust, paid monthly in arrears. The Sponsor has agreed to assume administrative and marketing expenses incurred by the Trust, including the Trustee’s monthly fee and out of pocket expenses, the Custodian’s fee and the reimbursement of the Custodian’s expenses, exchange listing fees, United States Securities and Exchange Commission (the “SEC”) registration fees, printing and mailing costs, audit fees and certain legal expenses. For the three months ended September 30, 2018 and 2017 , the Sponsor’s Fee was $ 210,347 and $ 329,748 , respectively. For the nine months ended September 30, 2018 and 2017 , the Sponsor’s Fee was $ 842,359 and $ 922,997 , respectively. At September 30, 2018 and at December 31, 2017 , the fees payable to the Sponsor were $ 71,899 and $ 124,409 , respectively. With respect to expenses not otherwise assumed by the Sponsor, the Trustee will, at the direction of the Sponsor or in its own discretion, sell the Trust’s palladium as necessary to pay these expenses. When selling palladium to pay expenses, the Trustee will endeavor to sell the smallest amounts of palladium needed to pay these expenses in order to minimize the Trust’s holdings of assets other than palladium. Other than the Sponsor’s Fee, the Trust had no expenses during the three and nine months ended September 30, 2018 and 2017 . Unless otherwise directed by the Sponsor, when selling palladium the Trustee will endeavor to sell at the price established by the LME PM Fix. The Trustee will place orders with dealers (which may include the Custodian) through which the Trustee expects to receive the most favorable price and execution of orders. The Custodian may be the purchaser of such palladium only if the sale transaction is made at the next LME PM Fix or such other publicly available price that the Sponsor deems fair, in each case as set following the sale order. A gain or loss is recognized based on the difference between the selling price and the cost of the palladium sold. Neither the Trustee nor the Sponsor is liable for depreciation or loss incurred by reason of any sale. Realized gains and losses result from the transfer of palladium for Share redemptions and / or to pay expenses and are recognized on a trade date basis as the difference between the fair value and cost of palladium transferred. |
Subsequent Events | 2.8. Subsequent Events In accordance with the provisions set forth in FASB ASC 855-10, Subsequent Events , the Trust’s management has evaluated the possibility of subsequent events impacting the Trust’s financial statements through the filing date. During this period, no material subsequent events requiring adjustment to or disclosure in the financial statements were identified other than the following: Effective October 1, 2018, the name of the Trust changed from ETFS Palladium Trust to Aberdeen Standard Palladium ETF Trust, and the name of the Shares issuable by the Trust changed from ETFS Physical Palladium Shares to Aberdeen Standard Physical Palladium Shares ETF. In addition, the name of the Trust’s Sponsor changed from ETF Securities USA LLC to Aberdeen Standard Investments ETFs Sponsor LLC. In connection with the Trust’s name change, the Trust’s CUSIP number changed to 003262102. In October 2018, the SEC posted to the Federal Register their Final Rule Release No. 33-10532 , Disclosure Update and Simplification Rule (the “Rule”) which has an effective date of November 5, 2018. The Sponsor has evaluated the effect that the Rule will have on the Trust’s 10-Q and has determined that the Rule will not have a significant impact on the presentation or disclosures in the Trust’s September 30, 2018 10-Q. The Sponsor has elected to forego the changes for the current interim reporting period, and will adopt the changes in the Trust’s 10-Q for the period ended March 31, 2019. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Categorization Of The Trust's Assets | (Amounts in 000's of US$) September 30, 2018 December 31, 2017 Level 2 Investment in palladium $ 145,394 $ 241,679 |
Schedule Of Investment In Palladium | Nine Months Year Ended Ended (Amounts in 000's of US$, except for ounces data) September 30, 2018 December 31, 2017 Ounces of palladium Opening balance 228,863.1 263,819.3 Creations 23,800.7 43,021.8 Redemptions (118,869.0) (76,489.4) Transfers of palladium to pay expenses (893.7) (1,488.6) Closing balance 132,901.1 228,863.1 Investment in palladium Opening balance $ 241,679 $ 178,342 Creations 24,277 37,402 Redemptions (114,467) (64,629) Realized gain on palladium distributed for the redemption of Shares 30,150 14,337 Transfers of palladium to pay expenses (894) (1,244) Realized gain on palladium transferred to pay expenses 268 266 Change in unrealized (loss) / gain on investment in palladium (35,619) 77,205 Closing balance $ 145,394 $ 241,679 |
Organization (Details)
Organization (Details) | 9 Months Ended |
Sep. 30, 2018shares | |
Organization [Abstract] | |
Minimum block of shares issued redeemed against palladium | 50,000 |
Significant Accounting Polici_4
Significant Accounting Policies (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | ||
Significant Accounting Policies [Abstract] | ||||||
Percentage of palladium held by the Zurich Sub-Custodian | 59.00% | 59.00% | ||||
Basket of shares | 50,000 | |||||
Fair value transfers | $ 0 | $ 0 | $ 0 | |||
Palladium receivable | 0 | 0 | ||||
Palladium payable | 0 | 0 | ||||
Reserve for uncertain tax positions | $ 0 | $ 0 | 0 | |||
Annualized rate of Sponsors Fee | [1] | 0.60% | 0.60% | 0.60% | 0.60% | |
Sponsor Fees | $ 210,347 | $ 329,748 | $ 842,359 | $ 922,997 | ||
Fees payable to Sponsor | 71,899 | 71,899 | $ 124,409 | |||
All other expenses | $ 0 | $ 0 | $ 0 | $ 0 | ||
[1] | Annualized for periods of less than one year. |
Significant Accounting Polici_5
Significant Accounting Policies (Categorization Of The Trust's Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment in palladium | $ 145,394 | $ 241,679 |
Significant Accounting Polici_6
Significant Accounting Policies (Schedule Of Investment In Palladium) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018USD ($)oz | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)oz | Sep. 30, 2017USD ($)oz | Dec. 31, 2017USD ($)oz | |
Significant Accounting Policies [Abstract] | |||||
Opening balance (in Ounces) | oz | 228,863.1 | 263,819.3 | 263,819.3 | ||
Creations (in Ounces) | oz | 23,800.7 | 43,021.8 | |||
Redemptions (in Ounces) | oz | (118,869) | (76,489.4) | |||
Transfers of palladium to pay expenses (in Ounces) | oz | (893.7) | (1,488.6) | |||
Closing balance (in Ounces) | oz | 132,901.1 | 132,901.1 | 228,863.1 | ||
Investment in palladium, fair value, Opening balance | $ 241,679 | $ 178,342 | $ 178,342 | ||
Creations | 24,277 | 37,402 | |||
Redemptions | (114,467) | (64,629) | |||
Realized gain on palladium distributed for the redemption of Shares | $ 3,914 | $ 1,865 | 30,150 | 8,318 | 14,337 |
Transfers of palladiuim to pay expenses | (894) | (1,244) | |||
Realized gain on palladium transferred to pay expenses | 52 | 78 | 268 | 166 | 266 |
Change in unrealized gain / (loss) on investment in palladium | 14,111 | $ 20,188 | (35,619) | $ 54,846 | 77,205 |
Investment in palladium, fair value, closing balance | $ 145,394 | $ 145,394 | $ 241,679 |