Gold shines amidst global volatil­ity

Business First - - NEWS -

Amidst global share mar­ket volatil­ity and un­cer­tainty, in­vestors are turn­ing to gold to di­ver­sify their port­fo­lios, ac­cord­ing to ex­change traded fund man­age Be­taShares. Gold has reemerged as an in-de­mand com­mod­ity, sig­nif­i­cantly in­creas­ing in value in the past few months. Ac­cord­ing to Be­taShares Man­ag­ing Di­rec­tor, Alex Vynokur, gold’s re­cent growth tra­jec­tory is driven by a num­ber of key eco­nomic fac­tors which may con­tinue to im­pact mar­kets through­out 2016.

“Widen­ing credit spreads across a broad range of sec­tors, in­clud­ing US oil and gas, are push­ing in­vestors to seek al­ter­na­tive as­set classes like gold,” said Mr Vynokur.

“In ad­di­tion, cen­tral banks be­hind tra­di­tion­ally ‘safe haven’ sov­er­eign is­suers such as Bank of Ja­pan, Swiss Na­tional Bank and Euro­pean Cen­tral Bank have moved to neg­a­tive in­ter­est rates.

“In this cli­mate, gold tends to rep­re­sent a ‘safe haven’ as­set that does not have a neg­a­tive real re­turn. Gold is widely re­garded as a re­li­able store of value, and has been for cen­turies. In un­cer­tain mar­kets like to­day’s, in­vestors are once again turn­ing to a tra­di­tional refuge, and gold has be­come an in-de­mand in­vest­ment.”

Be­taShares is see­ing the im­pact of in­vestor ap­petite for gold first hand with in­creased in­flows to the Be­taShares Gold Bul­lion ETF – Cur­rency Hedged (ASX: QAU).

Since the be­gin­ning of the year QAU has al­most dou­bled in size while gain­ing ap­prox­i­mately 14%, sig­nif­i­cantly out­per­form­ing the S&P/ASX 200 which is down al­most 7%*. Backed by phys­i­cal gold, QAU tracks the per­for­mance of the price of gold bul­lion. QAU is cur­rency hedged, to help pro­tect in­vestors from cur­rency risk, thus pro­vid­ing more pure ex­po­sure to the price of gold. *Past per­for­mance is not an in­di­ca­tion of fu­ture per­for­mance.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.