Despite the market turbulence caused by the COVID-19 pandemic, there are four funds in the Australian Core Strategies (ACS) universe which have returned more than 65% in the past year, all helped by the performance of gold.
Looking at performance across all sectors for the year to 30 April, four funds stood out as having performed best during the period thanks to their bias to the precious commodity.
All four funds had returned more than 50%, the only ones in the ACS universe to do so, and three of them had returned 70% or more.
These were BetaShares Global Gold Miners ETF Currency Hedged, Market Access NYSE Arca Gold BUGS Index, Select Baker Steel Gold and VanEck Vectors Gold Miners ETF.
Market Access NYSE Arca Gold BUGS Index was the best-performing fund over one year to 30 April with returns of 82.2% followed by BetaShares Global Gold Miners ETF which returned 75.6%. The VanEck Vectors Gold Miners ETF returned 70.5% while Select Baker Steel Gold reported positive returns of 69.6%.
The Select Baker Steel Gold fund was also one of the best-performing funds in the ACS universe over three years to 30 April, 2020 with total returns of 80%.
Gold has been boosted recently by the low interest rates and stimulus packages offered by central banks globally, the expanding debt levels and volatile stockmarkets. The commodity tends to be used as a hedge against inflation and a declining currency.
According to their factsheets, all four funds had large weightings to North America and held Newmont Mining and Barrick Gold as their two-largest holdings, the world’s two-largest gold miners.
Over the period, shares in US firm Newmont Mining rose 106% while Canadian firm Barrick Gold rose 108%.
Performance of four funds over one year to 30 April, 2020
