Golden share – Kommersant

Gold prices on the world market have updated a two-month high. Since the end of June, the cost of metal in dollars has increased by almost 3%, in rubles – by more than 7%. Investments in the precious metal reduce devaluation risks and act as protection against currency inflation. To hedge such risks, mutual funds focused on investing in gold are suitable. At the same time, it is necessary to take into account the market risks of the precious metal and the infrastructural features of the packaging.

Nobility in price

Gold is regaining its position in the world market. On July 20, gold hit a two-month high of $1,987.5 a troy ounce, up 1.7% from a week ago and nearly 3% from three weeks ago, according to Investing.com.

There were several good reasons for this rise. Investment strategist at VTB My Investments, Alexey Kornilov, notes two of them – the weakening of the dollar on the world market and the decline in yields on US Treasuries (US Treasuries). “All this is happening against the backdrop of waiting for the completion of the cycle of interest rate hikes by the Fed,” notes Mr. Kornilov.

A significant factor for quotes in the second half of the year will be the policy of the European Central Bank (ECB).

“If we see the weakening of the rhetoric and policy of the ECB in the fall, this will put pressure on quotes,” said Konstantin Samarin, senior analyst at SberCIB Investment Research. In the third quarter, he expects prices at $1950 per ounce, in the fourth quarter – $1980 per ounce. “The Fed’s rhetoric may remain tight, and the high rate cycle will last until the end of the year, which may limit the rise in gold prices from current levels,” said Mr. Samarin.

At the same time, growth can be expected on the Russian market, where the price of the metal reached RUB 5.7 thousand per year last week, the highest since March 28, 2022. Growth was more than 3% for the week and 7% since the beginning of the month. Since the beginning of the year, the precious metal has risen in price in the Russian market by almost 40%. The effect of rising world prices for gold increased the growth of the dollar due to an imbalance in supply and demand. Last week, the American currency rose by 0.9% to 90.9 rubles/$. Since the beginning of the year, the dollar has risen in price by more than 30%. Due to persistent devaluation factors, including a decrease in exports and an increase in imports, the ruble price of the metal may continue to grow, moreover, stronger than on the world market.

Packaging for gold

Currently, ten mutual funds are available to private investors, the yield of which depends on the value of the precious metal. At the same time, eight funds invest in physical metal, one each in securities of foreign ETFs and in shares of companies mining the precious metal. Since the beginning of the year, such funds have brought investors a return of 25-33%, and over the annual horizon – 55-78%.

The spread of results is due to different underlying assets within the funds.

Funds investing in physical metal more accurately repeat the dynamics of the value of the metal, as the value of the shares of mining companies can be influenced by corporate news, as well as general market sentiment.

In the case of funds with assets in the form of a “gold” ETF, clients will be charged a double commission: a Russian management company for managing the fund, as well as a commission for a foreign company for managing the ETF. In addition, “there is a slippage error in such funds” due to the fact that there is a time delay when investing and withdrawing funds when gold is bought or sold from him, Dmitry Skryabin, the manager of Alfa Capital, notes.

floating share

At the same time, as the managers note, the share of gold in the total portfolio of the investor should be present, but in a smaller proportion than the main investment asset classes – bonds and stocks. Investment Director of RB Capital Ivan Lavrinenko draws attention to the recommendations of large investment banks, which advise investing 5-10% in the precious metal. “Gold does not generate income, like bonds in the form of a coupon or stocks in the form of a dividend. Rather, it is a kind of insurance, ”Dmitry Skryabin points out.

At the same time, during periods of instability, investments in the precious metal, as a rule, increase, since gold is still considered by investors as a “safe haven”. According to Ivan Lavrinenko, it is possible to increase the share of gold in the portfolio during periods of rising global inflation, with expectations of a fall in interest rates in the currencies of developed countries, with an increase in geopolitical tensions. In the event of a decrease in global inflation, an increase in foreign exchange rates and a decrease in geopolitical risks, the share should be reduced, the expert notes.

Vitaly Gaidaev