Gold might be safe option
Investors should take a closer look at including gold in their portfolios at times of growing uncertainty in 2019, ETF Securities has said.
According to the firm, investors could benefit from gold’s ability to appreciate in a bear market due to its low or negative correlation with stocks and bonds.
This could be of particular importance given broader geopolitical risks, fuelled by growing US-China tensions and Brexit, ETF Securities’ chief executive, Kris Walesby, said.
“It’s also far from clear how aggressive the US Fed might be as it continues to raise interest rates. And at home we have a housing market downturn and a looming election throwing up headwinds,” he noted.
The firm’s GOLD ETF, which offered investors exposure to movements in gold prices in Australian dollars, jumped in December by 9.15 per cent, compared to a 0.37 per cent decline in the ASX 200.
According to Walesby, the fund’s performance was driven by the vital role that gold played in a “sensibly diversified portfolio”.
“Through our GOLD ETF, investors can have that diversification without any related transport, storage or insurance costs.”
AUTHOR
Oksana Patron
Recommended for you
With an explosion of private credit managers appearing in the market, two alternatives experts believe a consolidation is needed to maintain the quality of the sector.
Bentham Asset Management has become the latest fund manager to expand its distribution team as it reports increased interest in its credit strategies.
L1 Capital, which is in talks to merge with Platinum Asset Management, has indicated it will be voting against a deal to convert a Platinum LIC into an ETF.
Evidentia Group has hired a head of quantitative investments who joins the investment firm and managed account provider from AMP.
