The Gold Market Pioneer

Transcription

1 The Gold Market Pioneer Aureus Fund (Ireland) plc. The First Gold Fund in the World Established 2002

2 The world s first gold focused fund Long-term experience in the Gold market Aureus Fund SPDR Gold Shares ZKB Gold ETF Xetra Gold Promont Golden Solit Gold&Silver E-Fund Gold RBS physical Gold ishares Gold Lion Global Gold Fund Credit Suisse Lyxor Gold Bullion Sec. ETS Securities Hansagold Julius Bär Euwax Gold 2

3 The Aureus Fund at a glance No credit risk Diversified portfolio of gold, silver, platinum and palladium, with an up to 60% share of gold Precious metals are safely stored with Credit Suisse in Zurich, Switzerland Strong performance versus other precious metals funds Competitive fee structure versus other precious metals funds 3

4

5 Aureus Fund (Ireland) plc. The bullish case for Gold Storage of wealth in THE safe-haven investment Geopolitical hedge The benefits of white precious metals Aureus Fund (Ireland) plc. Best of both worlds: Portfolio insurance and return 5

6 A Negative yielding and QE end up in a depreciation war Where Gold is the only storage of wealth Only the Yen has held its value since the global financial crisis, but is expected to depreciate in the future due to a shift to fiscal stimulus and wage growth. Global QE reaches limits and has led to increased financial instability Gold/USD EUR/USD GBP/USD AUD/USD JPY/USD Source: Bloomberg, LBBW AM 6

7 A1 and monetary policy has led to mispricing of risks 12 Return-free risk instead of risk-free return Significant decrease in yield results in hunt for yield asset bubbles? Dividend Yield of European Equities European Corporate Bond Yield German Government Bond Yield European High-Yield Bond Yield Source: Thompson Reuthers Datastream, LBBW-AM Yields of the last five years as of

8 QE and negative interest rates have failed to stimulate economies GDP growth China GDP growth USA GDP growth EU GDP growth Japan -5-10

9 Fiscal policy is due to jump in More expansive fiscal policy in response to missing economic stimulation can result in 1 2 If fiscal policy is successful Inflation, potentially even hyper inflation If fiscal policy fails Continuously low interest rates, mispricing of assets, risk of asset bubbles as a result of hunt for yield Gold as an insurance against risks of inflation and asset price bubbles!

10 billion USD A1 1 If fiscal spending results in high inflation, the gold price is likely to rise Gold in USD (lhs) US CPI (rhs) +90% Gold cannot be mined as fast as money can be printed. Gold is a scarce resource, serving as inflation hedge % World public debt Above-ground gold stock Source: Economist, GFMS, WGC, LBBW AM, Bloomberg As of YE 2015

11 A1 2 If fiscal spending fails and asset bubbles burst, gold would be appreciated as storage of wealth Euro Stoxx 50 (lhs) ITRAXX Europe 10 Year (rhs) Source: Bloomberg, LBBW AM as seen at the end of the housing bubble and the European sovereign debt crisis in recent years, the gold price increased alongside increasing credit risk, when the bubbles burst (i.e. the stock market collapsed) Gold in USD (lhs) ITRAXX Europe 10 Year (rhs) Source: Bloomberg, LBBW AM

12 A2 Gold is furthermore appreciated as storage of wealth in times of geopolitical crises Soviet- Afganistan War Arab Spring 1. Gulf War Gulf War Irak War Gold in USD Source: Bloomberg, LBBW AM

13 Uncertainty A2 High Gold is THE safe haven in times of uncertainty! The known unknowns! Rebuilding confidence in the system Collapse of banking system in Italy US President Trump Loss of confidence in the monetary system Low Continuing Fed rate hikes Brexit Path Uncertainty Central Bank QE Programs. then there are still the unknown unknowns! Decreasing Performance of Gold Increasing Source: Bloomberg, LBBW AM 13

14 Aureus Fund (Ireland) plc. The bullish case for Gold The benefits of white precious metals Benefits of a diversified precious metals portfolio compared to a Gold-only investment Diversification adds performance Aureus Fund (Ireland) plc. Best of both worlds: Portfolio insurance and return 14

15 B1 Silver Beta play on Gold Silver in USD (lhs) Gold in USD (rhs) Source: Bloomberg, LBBW AM 15

16 demand in tonns B1 Platinum & Palladium: Geographically concentrated mine production can t match demand Platinum ~13% Palladium ~40% Platinum ~77% Palladium ~38% Platinum e Automobile Chemistry Other Jewellery Investment Supply Palladium e2016e Automobile Electronics Chemistry Dentistry Jewellery Investment Other Supply demand in tonns Source: GFMS, Johnson Matthey plc., LBBW Research 16

17 B If you trust in Gold never forget the white precious metals Performance since March 1992* Gold in USD diversified precious metals basket (monthly rebased) In times of an increasing Gold price, the white precious metals tend to outperform and provide benefit to a diversified precious metals portfolio like the Aureus Fund! *First publication of the palladium-fixings on Bloomberg The composition of the diversified basket corresponds to the holdings of the Aureus Fund Source: Bloomberg, LBBW AM 17

18 Aureus Fund (Ireland) plc. The bullish case for Gold The benefits of white precious metals Aureus Fund (Ireland) plc. Best of both worlds: Portfolio insurance and return Means to decrease portfolio risks due to diversification effects based on low correlation between asset classes like equities and the Aureus Fund Outperformance versus peers Absence of credit risks in contrast to ETF products 18

19 C1 Diversified precious metals portfolio as an investment philosophy Aureus Fund (Ireland) plc. was established in 2002 in Ireland as an open-ended investment company with variable capital (Irish Retail Fund). The Aureus Fund is now an Alternative Investment Fund (AIF), investing in 4 physical precious metals: Gold 59,5% Silver 13,5% Platinum 13,5% Palladium 13,5% 13,5% 13,5% 13,5% 59,5% Gold Silber Platin Palladium 19

20 C1 Aureus Fund shows low correlation with equities* ,5 0-0, Euro Stoxx 50 (lhs) Aureus Fund (rhs) Correlation ave. Correlation * Since 2007, no significant mining stocks holdings. *Since 2007, Aureus has had no significant holdings in mining companies Average correlation below zero! Source: Bloomberg, LBBW AM 20

21 C1 Adding the Aureus Fund can reduce a portfolio s volatility A 10% share in Aureus reduces an equity portfolio s volatility significantly, esp. in declining equity markets Volatility reduction in % (lhs) Euro Stoxx 50 Source: Bloomberg, LBBW AM 21

22 C2 150 If you want a precious metals fund, Aureus is the one to choose Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 AUREUS FUND SAFE PORT PRECIOUS METAL 95E ETFS PHYSICAL PM BASKET HANSAGOLD-EUR OFI PRECIOUS METALS-R Outperformance of peers due to allocation adjustments (over-/ underweighting) in reaction to market conditions Source: Bloomberg, LBBW AM 22

23 C3 Watch the spread Aureus Fund (Ireland) plc. As per Prospectus The repurchase (and subscription) per Share is based on the Net Asset Value per Share calulated at the Valuation Point for the relevant Dealing Day. No spread, subscription and repurchase daily on NAV. Security Holder Metals Securities Issuer ETCs Market-making Authorised Participants Agreements Authorised Participants Metal Securities issued or redeemed by Authorised Participants, subject to conditions. 23

24 C3 Funds vs. Certificates Aureus Fund (Ireland) plc. Certificates (ETC) Aureus Fund ETC Insolvency No issuer default risk Issuer default risk, as long as there is no ring fencing Legal structure Open-ended alternative investment fund Domicile Ireland Jersey Active Management Yes Yes Exchange traded commodity (ETC) Index Certificate Physically allocated metals Yes, Zurich Yes, London 24

25 C3 Metals are securely stored in Switzerland Fund investments are backed by physical precious metals stored with Credit Suisse in Zurich, Switzerland. Unlike peers, precious metals are not lent to third parties. The physical holdings are stored in so called segregated metal depots in London Good Delivery Bars (standard bars, c kg). 25

26 C3 and a vault visit is held annually The vault visit takes place annually by Board Members of the Aureus Fund. All bars are counted and randomly selected bars will be weighted by Board Members. The major institutional clients of Aureus are invited to attend annual precious metal site visits in Zurich. 26

27 C3 Ciste Déanta in Éirinn Launched in Ireland in 2002 Both independent and long experienced Irish Board Members have been working on the Board from the very beginning Irish Administrator, Custodian and Trustee A & L Goodbody as the Irish legal advisor PwC as the Irish Auditor 27

28 C3 At a glance Physical precious metals Mining Aureus Fund ETC Mining Fund Spread No spread Spread No spread Redemption Daily at NAV // Governed by Regulator & Prospectus Secondary market / Broker Daily at NAV // Governed by Regulator & Prospectus Insolvency No issuer default risk Issuer default risk No issuer default risk Legal structure Open-ended fund Exchange traded commodity (ETC) Open-ended fund Domicile Ireland Jersey Luxembourg Physically allocated metals Yes, Zurich Yes, London No 28

29 Aureus Fund Fund data ISIN Bloomberg Ticker Investment Policy Fund currency Management Fee TER Fund Volume (as of ) Reference Established Fund Manager Advisor Custodian Sub-Custodian / Storage IE AUREUSF ID equity Physical precious metals (at least 95%) Euro 0.70% 1.15% 260m Gold, Silver, Platinum, Palladium: 59,5%/13,5%/13,5%/13,5% LBBW Asset Management Investmentgesellschaft mbh Tresides Asset Management GmbH State Street International (Ireland) Limited Credit Suisse AG, Zurich 29

30 Disclaimer This presentation constitutes advertisement and serves to describe our services and the respective products. This document is intended for professional investors only. The information contained in this document does neither constitute any investment advice nor advice on the buying or selling of said products, it is merely a brief summary of key aspects of the funds. This information should not be regarded as a substitute for obtaining individual advice. The information contained herein has been carefully compiled by us and is based on generally accessible sources that we deem reliable. However, we are unable to assume any liability for the actuality, completeness and correctness. The presentation of historical data or the illustration of awards for the performance of the product provides no information about future performance. The performance shown above does not take into account fees and costs that are included in the subscription and redemption of shares. All expressions of opinion reflect the current views of our company and may be changed at any time without prior notice. The sole legally binding basis for purchasing/selling/swapping investment shares is the latest valid sales prospectus containing the terms and conditions, in conjunction with the most recent semi-annual and/or annual fund report. These documents are available in English, free of charge, in electronic or print versions from our advisor or at LBBW Asset Management Investmentgesellschaft mbh, P.O. Box , Stuttgart, Germany, info@lbbw-am.de or Investors Trust Europe, a State Street Company, No. 78 Sir John Rogerson`s Quay, Dublin 2, Ireland, info@aureusfund.com or at The shares of the product may only be offered for purchase, or sold, in legal systems where such an offer or sale is permitted. The fund is not registered or licensed under applicable U.S. financial services laws and regulations and must not be sold to US citizens. The products may not be offered, sold, transferred or transmitted, neither directly nor indirectly, in the US or in any other jurisdiction the product is not licensed. 30

31 Investment Manager: LBBW Asset Management Investmentgesellschaft mbh Fritz-Elsas-Straße Stuttgart In case of any questions please contact us on the address: Further information can also be found on our homepage:

32 Annex History of the open EU-AIF Aureus Fund (Ireland) plc. The Order process The Investment Limits

33 In order to comply with EU Directive 2011/61/EU, the Aureus Fund (Ireland) plc. applied for a Retail Investor Alternative Investment Fund (RAIF) licence in Ireland in July In Germany, the Aureus Fund (Ireland) plc. can be distributed to professional (institutional) clients only. History of the openended EU-AIF Aureus Fund (Ireland) plc. In anticipation of the diversification requirements of the new German Investment Tax Act of 2014, the ratio of Silver, Platinum and Palladium was increased in December Since December 2013, the Aureus Fund (Ireland) plc. invests predominantly (more than 51%) in physical allocated Gold. In practice, management intends to hold allocated Gold close to the maximum level of 60% of NAV. The Aureus Fund (Ireland) plc. Intends to invest at least 95% in allocated precious metals and is neither a bond nor a ETC/ETN.

34 NAV Order: There is no active secondary market on the Irish Stock Exchange. Orders should only be placed with the LBBW Fund Settlement Department in Stuttgart as a Fund NAV trade. Trading Details are only valid for NAV Orders via LBBW Kommissionshandel. Different rules might apply for order routed via third parties. Cut-off: 2 pm (German Time) The order process Order placement via LBBW / Network Management and Operations Services: FAX-Number: Phone Trading Investment Funds: Value = Trading Day +2 Business Days.[1] NAV will be published one business day after the trading day. Example: Order on: Wednesday (cut-off 2 pm German time) Valuation of precious metals at specific pm-fixing [2]: Wednesday (4 pm German time) NAV published: Thursday Value day: Friday ISIN: IE Please note: The Aureus Fund (Ireland) plc. has deposited a Global Certificate with Clearstream Banking and can easily be settled within the Clearstream Banking System. [1] NAV orders for settlement in Clearstream can only be placed with LBBW. Please contact us for non-clearstream trades on the Fund s register. [2] Business days are days on which retail banks are open for business in Dublin & Stuttgart (see Definition Prospectus), subject to change. [3] Gold: 4 pm German time; other assets might be valued at different times.

35 At least 95% of NAV will be held in physical precious metals in Switzerland Gold: Minimum 50% Target 59,5% Maximum 60% Investment Limits Prospectus and Internal White metals: Minimum 5% Target 13,5% Maximum 30% Silver Target 13,5% Platinum Target 13,5% Palladium Target 13,5%