Invest in gold

Gold as an investment​

Gold is an asset that plays an important role in an investment portfolio. Its low correlation with the broad stock market means a higher risk-adjusted return on a portfolio that to a large extent consists of equities and interest rates.

Historically, gold has functioned as an effective portfolio protection, both against uncertainties / volatility in the market, and as a protection against inflation.

How to invest in gold?

There are several ways to invest in gold:

  • Physical gold: You can buy the physical raw material and store it at home, or in another safe place.

  • ETCs (Exchange Traded Commodities): By buying an ETC, you own physical gold, but you do not have to take care of the storage yourself.

  • Derivatives: Investment products that follow the price of gold, but where you have a counterparty risk against the issuer of the product.

  • Shares: The share price of the mining companies that extract gold is strongly linked to the spot price for gold. Mining company shares often move more than the price of the underlying asset because you also add a company risk. This means that the share goes up more when e.g. the gold price goes up, and vice versa.

  • Funds: There are different types of gold funds. When you invest in a fund, you pay a fee for an expert (fund manager) to select the underlying assets that provide exposure to gold. A fund may include any of the options listed above. There are two types of funds:

    • Daily traded fund: Often actively managed, which means that an expert reviews the holdings and rebalances at regular intervals.

    • Exchange Traded Fund: A basket of securities that follows an index and is traded as a stock.

An example of a gold mining company fund is the AuAg ESG Gold Mining UCITS ETF.