iShares S&P GSCI Commodity-Indexed Trust GSG

iShares S&P GSCI™ Commodity-Indexed Trust is a Delaware statutory trust that issues shares representing fractional undivided beneficial interests in its net assets. The trust’s assets consist of long positions in exchange traded index futures contracts on the S&P GSCI Excess Return Index together with cash U. S. Treasury securities or other short term securities that serve as collateral for those futures. Its investment objective is to track the total return of the S&P GSCI Total Return Index before expenses and liabilities. The trust is operated as a commodity pool by iShares Delaware Trust Sponsor LLC with BlackRock Institutional Trust Company N. A. as trustee and BlackRock Fund Advisors as commodity trading advisor. It is not registered as an investment company under the Investment Company Act of 1940 as amended. Shares are created and redeemed only in baskets of fifty thousand units through authorized participants who deliver the required futures and collateral.

The trust does not generate operating revenue; its value changes with the performance of the underlying index futures and the interest earned on its collateral assets. Returns to investors come from gains or losses on the long futures positions and from interest on cash Treasury securities held as margin. The trust seeks to mirror the S&P GSCI Total Return Index by holding futures that reflect the index’s excess return and by earning a cash return comparable to the Treasury component of the index. Any cash received from creation of shares is used to purchase additional futures or collateral to maintain the desired exposure. Because the trust follows a passive strategy it does not engage in active trading or attempt to profit from short term movements in the index or the collateral. The net asset value is calculated each business day based on the settlement prices of the futures and the market value of the collateral.

Within the commodity exchange traded product landscape the trust competes with other funds that aim to provide broad commodity exposure through futures based indices. Its main rivals include products such as the Invesco DB Commodity Index Tracking Fund and the United States Commodity Index Fund. The trust benefits from the sponsorship of BlackRock which provides scale robust infrastructure and low expense ratios. Its passive tracking approach and daily transparency of net asset value help it attract investors seeking efficient commodity market access. The trust’s structure allows it to avoid the complexities of physical commodity storage while still delivering exposure to a diversified basket of futures. Because it is sponsored by a major asset manager the trust enjoys strong liquidity and tight tracking error relative to the index.

The trust’s shares are bought and sold by a mix of institutional investors retail traders and financial advisors who seek commodity exposure without needing to manage futures contracts directly. Authorized participants which are registered broker dealers such as Goldman Sachs J. P. Morgan Morgan Stanley and others create and redeem baskets of shares in exchange for the underlying futures and collateral. Retail investors can hold the shares through standard brokerage accounts and trade them on NYSE Arca throughout the market day. Only those who have entered into an authorized participant agreement may directly create or redeem shares while other investors rely on secondary market transactions. The trust does not have a single dominant customer group; its user base consists of anyone who wishes to gain diversified commodity exposure through an exchange traded structure. Because shares are listed on a national exchange they are accessible to a wide range of investors seeking a simple way to add commodity risk to their portfolios.