Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI)

Overview

The Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) offered exposure to the daily performance of a covered call strategy on gold, providing income from call option premiums and potentially limiting upside participation. However, it has been delisted and no longer trades.

Reputation and Reliability

Credit Suisse, a global financial services company, had a long history but faced financial difficulties that led to its acquisition. Its reputation suffered due to risk management failures.

Management Expertise

The ETN was structured and managed by Credit Suisse's structured products team, which had experience in creating and managing similar products, but the entity no longer exists.

Goal

The investment goal was to provide investors with monthly income by implementing a covered call strategy on gold futures.

Investment Approach and Strategy

Strategy: It tracked the performance of the Cboe Gold 1-Month Volatility Index (GVZ) covered call index which involved holding gold futures and selling call options on those futures to generate income.

Composition The ETN's return was linked to gold futures contracts and the premiums received from selling covered call options. It did not directly hold physical gold.

Market Share: N/A (Delisted)

Total Net Assets (AUM): N/A (Delisted)

Key Competitors

• IAU
• GLD
• OUNZ

Competitive Landscape

The gold ETF market is dominated by physically backed ETFs like GLD and IAU. GLDI attempted to differentiate itself via a covered call strategy for income, but the complexity and capped upside made it less popular, and the issuer's issues contributed to its delisting.

Historical Performance: Historical performance data is not relevant as the ETN is delisted.

Benchmark Comparison: Comparison to benchmarks is not relevant as the ETN is delisted.

Expense Ratio: The expense ratio was 0.65% (prior to delisting).

Average Trading Volume

Average trading volume data is no longer relevant as the ETN is delisted.

Bid-Ask Spread

Bid-ask spread data is no longer relevant as the ETN is delisted.

Market Environment Factors

Prior to delisting, the ETN's performance was affected by gold prices, interest rates, and volatility in the gold market.

Growth Trajectory

The ETN's growth was limited due to its capped upside potential from the covered call strategy and the issuer's financial troubles which ultimately led to delisting.

Competitive Edge

GLDI aimed to offer a unique advantage by providing income through covered calls on gold. This strategy was different from physically-backed gold ETFs. However, the complexities associated with the covered call strategy and the limited upside potential didn't resonate with many investors. Ultimately the ETN was susceptible to the volatility in the gold market and the performance of Credit Suisse as the issuer.

Volatility

The ETN was subject to the volatility of gold prices and the covered call strategy it employed, potentially leading to periods of significant price fluctuations.

Market Risk

Specific risks included the possibility of lower returns in rising gold markets due to the capped upside from the covered call strategy, as well as issuer risk related to Credit Suisse, which ultimately proved significant.

Ideal Investor Profile

The ETN was potentially suitable for income-seeking investors who were comfortable with the complexities of covered call strategies and understood the risks of capped upside. Not appropriate now as delisted.

Market Risk

It was potentially better suited for investors with a moderate risk tolerance seeking income from gold exposure. No longer available for investment.

The Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) was designed to generate income by implementing a covered call strategy on gold futures. However, the strategy capped upside potential and presented complexities that made it less appealing than simpler gold ETFs. Due to issuer-related issues and performance challenges, the ETN was delisted and is no longer available for investment. Investors seeking exposure to gold should consider physically backed ETFs instead. GLDI served as a reminder of the importance of issuer creditworthiness in exchange-traded products.

Data Sources:

• SEC Filings
• ETF.com
• Company Fact Sheets (historical)

Disclaimers:

This analysis is based on historical data and publicly available information. The ETN is delisted, and the information is provided for informational purposes only and should not be considered investment advice.