Congratulations to the Euro 2020 Italian supporters for a game well played – the Azzuris will be bringing the cup home to Rome.
Unfortunately, Italy was not able to celebrate a double win, as Serbia’s Novak Djokovic took home the Wimbledon trophy after beating his Italian compatriot, Matteo Berrettini.
Next Golden trophies up for grab? Tokyo Olympics!
So Who’s Up for Gold?
While we patiently await the Olympic games in Japan to kick off, one asset class that is in the lead for Gold is…..Gold. The precious metal has seen its price climb to a near three-week high in recent weeks, boosted by the emergence of a new Covid-19 strain which is casting a dark cloud over global economies.
Resurgence of the Covid-19 virus through the Delta strain has been a key concern for global markets. A strain known to be more deadly than the previous strains, Asian economies have been left scrambling to desperately to keep the virus at bay. Disparity between the recovery in the Western countries against that of its Eastern counterparts has never been more glaring. The ability to rapidly vaccinate its citizens has allowed the economies in the West to climb back on track while Asia is still staring down the dark tunnel as many sectors remain closed as a precautionary measure.
While these uncertainties have not been welcoming news for risk assets, safe haven solutions such as Gold is seeing demand climb as investors take on a more cautious stance for their portfolio. Investment experts are already calling for a 10% allocation into Gold until more stability is found.
What’s Next for Global Economies?
Is another shutdown on the cards for all of us?
What lies ahead remains uncertain for most global economies as the pressures from rising infection cases pushes governments to find ways to keep the infection levels down. Concurrently, restarting the economy after a prolonger period of shutdown remains a challenge that the governments need to deal with.
Which inadvertently makes it an opportunistic time to be invested in Gold in the near-term, given that it typically strives during times of uncertainty. Coupled with a lower, and more stable yield, holding cost of non-income yielding assets are now looking more affordable.
How Has Gold Performed So Far?
While the US equity indices is in a strong lead since the start of the year with a 21.3% gains in MYR terms, Gold is slowly creeping up. Though the performance of Gold is far eclipsed by the performance of US’ S&P 500 Index on a year-to-date basis (-0.6%, and 21.3% respectively in MYR terms as at 9 July 2021), Gold has leaped ahead since the start of July. As uncertainties continue to flood global economies, price of Gold has recorded a stellar 3.6% gain in MYR terms, as gauged by the LBMA Gold Price.
How To Get Exposure?
One of the most efficient methods of gaining exposure to the movement of Gold price is known to be through an ETF.
Why? Cause instead of buying and selling physical Gold through a jeweller who will charge you a wider difference between the buy/sell price, an ETF does the buying and selling of physical Gold for you, on top of managing the logistics, storage, and insurance, as well as provide a transparent buy/sell price based on the prevailing market price of Gold.
So What is the TradePlus Shariah Gold Tracker?
- TradePlus Shariah Gold Tracker, or more commonly referred to by its Bursa Stock Code 0828EA, is a physically backed Gold ETF that is listed on Bursa.
- The 0828EA is benchmarked against the LBMA Gold Price, and buys into Gold bars with 99.9 fineness through accredited LBMA Gold refiners.
- The ETF is the first, and remains the only Shariah-compliant commodity-backed ETF that is listed on Bursa.
- With Amanie Advisors Sdn Bhd as its Shariah advisor, the ETF is subject to annual reviews to ensure that its processes and procedures adhere to the Shariah principles.
- As a Shariah-complaint ETF, investors who are looking to trade the ETF through their preferred broker may be required to contact their broker prior to trading to ensure their accounts have sufficient funds prior to trading as a cash-upfront payment is required.
- Trading at a minimum board lot size of 100 units on Bursa, investors can gain access to Gold price for less than RM300.
- The 0828EA is now available in a Unit Trust format in the form of Affin Hwang Shariah Gold Tracker – a Fund that feeds directly into the ETF.
- Additionally, 0828EA is also the preferred Gold ETF by Wahed Investment – the online Shariah-investment platform that allows investors to start investing with as little as RM100.
For more information
Still not completely convinced about the Gold ETF? Need more information about the product? Hop over to www.tradeplus.com.my/gold-tracker for more details regarding the ETF.
Alternatively, feel free to reach out to us via the contact points below:
Disclaimer: This article has been prepared by Affin Hwang Asset Management Berhad (hereinafter referred to as “Affin Hwang AM”) specific for its use, a specific target audience, and for discussion purposes only. All information contained within this presentation belongs to Affin Hwang AM and may not be copied, distributed or otherwise disseminated in whole or in part without written consent of Affin Hwang AM. The information contained in this presentation may include, but is not limited to opinions, analysis, forecasts, projections and expectations (collectively referred to as “Opinions”). Such information has been obtained from various sources including those in the public domain, are merely expressions of belief. Although this presentation has been prepared on the basis of information and/or Opinions that are believed to be correct at the time the presentation was prepared, Affin Hwang AM makes no expressed or implied warranty as to the accuracy and completeness of any such information and/or Opinions. As with any forms of financial products, the financial product mentioned herein (if any) carries with it various risks. Although attempts have been made to disclose all possible risks involved, the financial product may still be subject to inherent risk that may arise beyond our reasonable contemplation. The financial product may be wholly unsuited for you, if you are adverse to the risk arising out of and/or in connection with the financial product. Affin Hwang AM is not acting as an advisor or agent to any person to whom this presentation is directed. Such persons must make their own independent assessments of the contents of this presentation, should not treat such content as advice relating to legal, accounting, taxation or investment matters and should consult their own advisers. Affin Hwang AM and its affiliates may act as a principal and agent in any transaction contemplated by this presentation, or any other transaction connected with any such transaction, and may as a result earn brokerage, commission or other income. Nothing in this presentation is intended to be, or should be construed as an offer to buy or sell, or invitation to subscribe for, any securities. Neither Affin Hwang AM nor any of its directors, employees or representatives are to have any liability (including liability to any person by reason of negligence or negligent misstatement) from any statement, opinion, information or matter (expressed or implied) arising out of, contained in or derived from or any omission from this presentation, except liability under statute that cannot be excluded.
Warning Statement: A copy of the Prospectus / Supplemental Prospectus for the TradePlus Shariah Gold Tracker can be obtained at Affin Hwang Asset Management's (“Affin Hwang AM”) website at www.tradeplus.com.my. Investors are advised to read and understand the contents of the Prospectus dated 28 November 2017 and Supplemental Prospectus dated 2 July 2019 for TradePlus Shariah Gold Tracker before investing. There are fees and charges involved when investing in the fund stated herein. Investors are advised to consider and compare the fees and charges as well of the risks carefully before investing. Investors should make their own assessment of the risks involved in investing and should seek professional advice, where necessary. The price of units and distribution payable, if any, may go down as well as up and past performance of the fund should not be taken as indicative of its future performance. The Securities Commission Malaysia has not reviewed this material and takes no responsibility for the contents of this material and expressly disclaims all liability, however arising from this material.