This year has been a prosperous time for gold investors, with prices rising by almost 30% in the 12 months to end October 2019. The price also topped AUD 2,000 per troy ounce for the first time ever.
The increase in the gold price, which has been driven by multiple factors including three interest rate cuts by the Reserve Bank of Australia, has led to a notable rise in demand for gold across The Perth Mint’s range of investment products.
This includes The Perth Mint’s ASX listed gold product, ticker: PMGOLD. On Monday 4 November, PMGOLD reached 4 tonnes in total gold holdings, with the market value of the product now in excess of AUD 275 million. This is a direct result of the huge inflows we’ve seen into the product this year and the rise in the gold price.
Designed to track the price of gold in Australian dollars, PMGOLD can be bought and sold like a regular share, which makes it highly accessible to any Australian investor with a brokerage account. Each unit of PMGOLD represents 1/100th of a troy ounce of gold, with the physical gold which backs the product stored at The Perth Mint.
Unique in the market, PMGOLD offers a number of features making it particularly attractive to Australian investors. These include:
• A management fee of only 0.15%, making it the lowest cost gold product on the ASX;
• A government guarantee on the gold backing each unit, making it a trusted investment option; and
• A redemption process whereby investments in PMGOLD may be exchanged for physical Perth Mint gold products such as bars and coins, which are deliverable upon request anywhere in Australia.
If you already trade shares, PMGOLD is a very easy way to incorporate gold into your portfolio. You can find out more about PMGOLD by downloading the latest fact sheet here.
Perth Mint research makes case for gold
Supporting the case for precious metal investment today is the historical outperformance of gold in low real interest rate environments.
Exclusive research conducted by The Perth Mint, which looks at the performance of various Australian asset classes between 1971 and 2018 found that gold outperformed both stocks and bonds in years where real interest rates were 2% or lower, with an annual average return of just over 20%.
These findings are highly relevant for all Australian investors given real interest rates are already negative today, with yields on longer term government bonds indicating we may be in low interest rate environment for at least another decade.
You can read this research in full here
Disclaimer:
Past performance does not guarantee future results. The information in this article and the links provided are for general information only and should not be taken as constituting professional advice from The Perth Mint. The Perth Mint is not a financial adviser. You should consider seeking independent financial advice to check how the information in this article relates to your unique circumstances. All data, including prices, quotes, valuations and statistics included have been obtained from sources The Perth Mint deems to be reliable, but we do not guarantee their accuracy or completeness. The Perth Mint is not liable for any loss caused, whether due to negligence or otherwise, arising from the use of, or reliance on, the information provided directly or indirectly, by use of this article.
