ETF Securities Weekly Flows Analysis Precious metal flows bifurcated by gold and silver

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1 Aneeka Gupta Associate Director Equities & Commodities 11 December 217 ETF Securities Weekly Flows Analysis Precious metal flows bifurcated by gold and silver Industrial metal ETPs saw the lion s share of outflows amounting to US$13.4mn, led by outflows from broad basket ETPs. Precious metal ETP flows were polarised, as gold ETPs suffer the largest outflows while silver ETPs receive the largest inflows. Crude oil ETP outflows persist for the 12 th week in a row, largely driven by WTI crude oil ETPs. Weekly Flows by Sector (US$mn) TOTAL Diversified Energy Industrial Metals Precious Metals Agriculture Livestock Equities Bonds FX Top 5 Inflows/Outflows (US$mn) Silver Nickel Natural Gas EUR JPY Precious metals Industrial metals Diversified Crude oil Gold -5.8 Top 5 / Bottom 5 Performers Cotton Europe Equity USD NZD NOK Carbon Zinc Coffee Cocoa Natural Gas -2% -1% % So urce: ETF Securities No te: s ee next page (*) % -9.7 % -4.9% -5.% -5.1 % % 1.2% 1.1 %.8%.7 % Industrial metal ETPs break the two week winning streak of inflows, registering outflows of US$13.4mn on the back of profit taking by investors after strong price gains. The outflows were dominated by broad basket ETPs worth US$118.4mn. We expect the supply deficit to extend into 218 owing to the lack of investment in mining infrastructure. In addition strong growth from emerging markets (accounting for 7% of demand) should support demand for industrial metals going forward. Gold ETPs suffer outflows of US$39.6mn for the third consecutive week. Gold is poised for its biggest weekly price drop -2.63% since May as the strong jobs report released on Friday underpins the Fed s case for tighter monetary policy, thereby curbing the appeal for the non-interest bearing bullion. The anticipation of higher U.S. interest rates coupled with progress on tax reform has helped lift the US dollar higher adding further pressure on gold prices. Furthermore the improvement in risk appetite considering the postponement of the US partial government shutdown and ongoing progress in the Brexit negotiations have diminished gold s role as a safe haven asset. Bitcoin s explosive appreciation has also taken some of the shine off gold. We expect gold to remain flat over the coming year discounting the likelihood of any geopolitical flare up. Record low prices drive bargain hunters into silver ETPs attracting the highest inflows worth US$42.5mn in 1 weeks. Known to derive majority of its use in the industrial applications sector, silver looks under-priced when compared to the rally staged by the industrial metals sector. It has also lagged its precious metal counterparts owing to negative sentiment. As the narrative for improving global economic conditions remains intact, we expect silver to rebound from current levels buoyed by positive investor sentiment and rising industrial demand. Outflows from crude oil ETPs amounting to US$2.4mn persist for the 12 th consecutive week, largely driven by outflows worth US$19.3mn from WTI crude oil ETPs. We continue to believe that the OPEC led rally is likely to be short lived and the current high compliances levels are at risk of slipping as the option for a premature exit from the production cuts has been inserted. Given the current pace of oil production expansion in the US, the global supply deficit will be short lived and this is likely to weigh on prices going forward. Note: All flow and data in this report are based on ETF Securities ETP numbers to 8 December 217 and are denominated in USD unless otherwise indicated. Investments may go up or down in value and you may lose some or all of the amount invested. Past performance does not guarantee future results.

2 2 ETF Securities ETF Securities Commodity ETP Flow Trends ETP FLOWS (in US$m) ASSETS TOTAL ,87.5 1, ,94 Diversified ,26 PERFORMANCE (US$) Precious Metals ,53 Basket % -3.2% 4.% 1.5% Gold , % -2.3% 7.9% 7.4% Silver , % -6.4% -2.5% -6.6% Platinum % -4.% -1.2% -3.2% Palladium % 1.3% 49.2% 35.5% Energy ,562 Basket % -5.2% -1.2% -7.6% Crude oil , % -2.% 4.6% 7.9% Natural Gas % -16.4% -4.4% -4.7% Heating Oil % -2.1% 5.1% 1.% Gasoline % -5.3% -2.8% 6.% Carbon %.3% 22.9% 8.2% Industrial Metals Basket % -5.% 14.5% 7.7% Aluminium % -4.6% 14.9% 11.1% Copper % -4.3% 14.7% 8.5% Nickel % -9.% 7.5% -6.2% Zinc % -4.3% 19.2% 13.1% Tin %.2% -7.1% -6.1% Lead % -3.5% 18.5% 2.8% Agriculture Basket % -1.4% -11.4% -13.5% Wheat % -6.2% -14.7% -16.4% Corn % -1.4% -12.9% -14.8% Soybeans %.5% -5.2% -9.3% Cotton % 7.4% 5.% 4.8% Coffee % -6.1% -19.2% -2.5% Sugar % -4.3% -3.4% -29.4% Soybean Oil % -4.7% -7.4% -13.8% Cocoa % -15.% -14.1% -15.8% Livestock Basket % -5.1% 2.3% 8.3% Lean Hogs % -2.6% -3.1% 4.1% Live Cattle % -6.3% 5.3% 1.5% Equities ,92.3 1,11.7 2,78 Global ,5.1 1,25. 1, %.8% 21.1% 2.4% US % 2.3% 2.% 19.1% Europe %.1% 8.9% 11.1% Asia % -6.1% 16.7% 1.2% Australia % -.1% 1.6% 12.9% Bonds Global %.4% 4.9% 5.% Europe %.9% 1.8% 2.7% Emerging Markets % 1.1% 11.3% 11.5% FX G USD % -.5% -8.1% -7.6% CAD % -1.4% 3.5% 1.2% EUR %.7% 7.% 7.8% GBP %.5% 1.3% -.6% CHF % -.7% -6.4% -6.1% NOK % -2.7% -4.6% -5.5% SEK % -2.1% -1.5%.1% JPY %.2% -.6% -1.9% CNY % -.2%.%.3% INR %.3% -.5% -.7% AUD % -2.3% -.2% -2.3% NZD % -1.3% -6.3% -7.7% Commodity FX (*) All data as at 8 Dec 17, based on ETF Securities global commodity ETP flows and assets. In FX due to being pair trades there is double counting. Price performance is based on NAV data for commodities, indices for Bonds & Equities, Trade weighted indices for FX, Bloomberg

3 3 ETF Securities Net Cumulative Flows by Asset Classes over the past year Com modities 1,2 1, Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Bonds Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Equities 1,2 1, Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Currencies Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 All Commodity ETPs Flows Analysis DIVERSIFIED Diversified ,26 All Commodities Ex-Energy Ex-Ags and Liv Past Month Flows in Diversified ETPs DIVERSIFIED -$4.4 All Commodities -$13.6 Ex-Energy Ex-Agriculture and Livestock $9.3 1,6 1,4 1,2 1, 8 6 Net Cumulative Flows into Diversified Commodities % -5% % 5% 1% 25 2 Ex-Agriculture and Livestock

4 4 ETF Securities Energy ETPs Flows Analysis ENERGY Energy ,562 Energy Basket Crude oil ,338 Natural Gas Heating Oil Gasoline Carbon Past Month Flows Trends in Energy ETPs ENERGY Energy Basket Crude oil Natural Gas Heating Oil Gasoline Carbon Net Cumulative Flows into Energy 5, 4,5 4, 3,5 3, 2,5 2, 1, % -5% % 5% 1% 2 1 Crude oil Precious Metals ETPs Flows Analysis PRECIOUS METALS Precious Metals ,53 PM Basket Gold ,386 Silver ,364 Platinum Palladium Past Month Flows in Precious Metals ETPs PRECIOUS METALS PM Basket Gold -$1.8 -$.4 -$3.8 -$34.5 -$64.3 Silver -$.9 $74.4 Platinum -$.5 $2.6 Palladium -$9. Net Cumulative Flows into Precious Metals 16, 15, 14, 13, 12, 11, 1, 9, 8, % -5% % 5% 1% 25 2 Silver

5 5 ETF Securities Industrial Metals ETPs Flows Analysis INDUSTRIAL META Industrial Metals IM Basket Aluminium Copper Nickel Zinc Tin Lead Past Month Flows in Industrial Metals ETPs INDUSTRIAL METALS IM Basket Aluminium Copper Nickel -$1.4 -$.9 -$.7 $13.2 $45.8 $5.6 $38.9 $14.3 Zinc -$.9 $.1 Tin $.1 $. $.1 $. 1,5 1,4 1,3 1,2 1,1 1, Net Cumulative Flows into Industrial Metals % -5% % 5% 1% 12 Copper Agriculture ETPs Flows Analysis AGRICULTURE Agriculture Agri Basket Wheat Corn Soybeans Cotton Coffee Sugar Soybean Oil Cocoa ,5 1,3 1, Net Cumulative Flows into Agriculture Past Month Flows in Agricultural ETPs AGRICULTURE -$1.6 -$6.4 Agri Basket -$.8 $11.1 Wheat$. Corn -$13.3 -$11.8 Soybeans $2.3 Cotton -$.3 -$.6 Coffee -$.1 $1.9 Sugar -$.8 $.1 Soybean Oil $. $.3 Cocoa -$.3 $4.8-1% -5% % 5% 1% 9 8 Cocoa

6 6 ETF Securities Livestock ETPs Flows Analysis LIVESTOCK Livestock Livestock Basket Lean Hogs Live Cattle Past Month Flows in Livestock ETPs LIVESTOCK -$.2 $.2 Livestock Basket $. Lean Hogs -$.1 $.2 Live Cattle -$.1 Net Cumulative Flows into Livestock % -5% % 5% 1% Live Cattle Equity ETPs Flows Analysis EQUITIES Region ,92.3 1,11.7 2,78 Global ,5.1 1,25. 1,553 US Europe Asia Australia Themes ,23.9 1,44.8 1,633 Small Cap MLP Gold Miners Robo ,17 Cyber Past Month Flows in Equity ETPs EQUITIES Global US $161.3 $131.3 $7.2 $4.9 Europe Asia $19.4 $4.9 Australia $3.5 % 2% 4% 6% 8% 1% Net Cumulative Flows into Equities 2,4 2,2 2, 1,8 1,6 1,4 1,2 1, Robo

7 7 ETF Securities Bond ETPs Flows Analysis BONDS Bonds Global Europe Emerging Markets Government Corporate Past Month Flows in Bond ETPs BONDS -$1.6 Global -$.1 Europe Emerging Markets -$1.6-1% -8% -6% -4% -2% % 6 5 Net Cumulative Flows into Bonds 4 2 Europe Currency ETPs Flows Analysis CURRENCIES FX G USD CAD EUR GBP CHF NOK SEK JPY CNY INR AUD NZD Commodity FX n.b. Due to each currency being a pair, there is double counting in the flow data Net Cumulative Flows into Currencies G1 USD CAD EUR GBP CHF NOK SEK JPY CNY INR AUD NZD Commodity FX Past Month Flows in Currency ETPs % -5% % 5% 1% USD -4.

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