What income did “gold” mutual funds bring?
[ad_1]
For the third week in a row, gold prices on the world market have remained above $2 thousand per troy ounce. Since the beginning of October, the cost of the precious metal in dollars has increased by almost 12%, but in rubles, due to the strong strengthening of the national currency, it has remained almost unchanged. However, since the beginning of the year, “gold” mutual funds have brought shareholders an income of 33–41%. Taking into account the continuing risks of a weakening ruble and rising dollar prices, such investments remain relevant for next year. At the same time, it must be taken into account that, unlike foreign currency bonds, gold does not bring coupon income.
Rate inhibition
At the beginning of December, gold on the world market for the first time in history overcame the barrier of $2.1 thousand per troy ounce. According to Investing.com, on December 4, the price of gold reached $2,136 thousand per ounce. Despite the fact that the rally did not continue, gold quotes remain above $2 thousand per ounce.
There were enough reasons for maintaining such high prices for the precious metal. First, investors continued to increase their investments in gold amid the escalation of conflict in the Middle East. Secondly, the rise in prices was facilitated by the decline in the dollar exchange rate and UST yields against the backdrop of a softening of the Fed’s positions. At the end of the meeting on December 13, the American financial regulator kept the rate at 5.25–5.5% and made it clear that the tightening of monetary policy carried out over the past two years is coming to an end, and a reduction in borrowing costs will occur in 2024 .
According to the dynamics of futures for interest rate changes, markets expect a rate reduction of 25 basis points as early as March 2024. p., up to 5–5.25% with a probability of 74%.
Previously the probability was estimated at 50%. “A decrease in the base interest rate, on the one hand, will affect the decline in yields of American government bonds, and on the other hand, will affect the decline of the American currency, which leads to an increase in the price of gold,” says Alexandra Falkova, portfolio manager of Management Company Pervaya.
Currency markdown
In Russia, quotations of the precious metal showed less expressive dynamics. At the end of last week, the price of gold on the Moscow Exchange stood at 5.7 thousand rubles/year. This is only 0.3% higher than the values a week ago, but 1.3% lower than the values at the beginning of October. The effect of rising world gold prices was offset by the fall in the dollar exchange rate on the Russian market. Last week, the American currency exchange rate was 90.2 rubles/$, thus, since the beginning of October, the dollar has lost more than 10% in value.
Despite the decline in the ruble price of the metal in recent weeks, it is still noticeably higher than a year ago (slightly above 4 thousand rubles/year).
Therefore, taking into account the continuing devaluation risks, interest in gold remains in the domestic market. According to Kommersant’s estimates, based on Investfunds data, in November private investors invested almost 820 million rubles in mutual funds focused on gold assets, and since the beginning of the year – more than 3.1 billion rubles.
Noble mutual funds
Currently, nine mutual funds are available to private investors, the profitability of which depends on the movement of the value of the precious metal. At the same time, seven funds invest in physical metal, one each in securities of foreign ETFs and in shares of Russian gold mutual funds. Over 11 months, such investments brought shareholders 33–41% income. The best results were shown by funds investing in physical metal. In the case of funds with assets in the form of “paper” gold, clients are charged a double commission – the commission of the management company that included the “paper” gold in the fund, and the commission of the company managing this fund.
Portfolio managers note that gold should always be present in a well-diversified investment portfolio. “This is a protective asset that smoothes out portfolio volatility due to weaker correlation with other instruments,” notes Alexandra Falkova. Therefore, according to Dmitry Scriabin, portfolio manager of Alfa Capital Management Company, on average his share should account for about 10% of the portfolio. “The more conservative the approach, the larger the share should be,” he notes. However, gold itself does not generate income in the form of coupons or dividends, and therefore should not occupy a significant part of the portfolio for a long period of time, market participants note.
[ad_2]
Source link