‘Gold coin unit trust gains traction’
BUSINESS REPORTER
Asset management firm, Bard Santner Investors, says its gold coin unit trust has generated “significant interest” two weeks after its launch to offer investors an inflation-proof asset.
The unit trust came six months after the Reserve Bank of Zimbabwe (RBZ) introduced gold coins as an investment alternative and to mop excess liquidity.
Tatenda Hungwe, Bard Santner Markets Inc executive director, told Business Times the momentum gained has been encouraging.
“We are delighted with the response thus far and expect to see a rise in adoption as it continues to gain traction. The diaspora has shown a keen interest in the product, which is a positive indicator of interest in domestic savings and investment offerings,” Hungwe said.
The minimum investment in the in the gold coin unit trust is US$120 which also be made in monthly installments of US$15 or equivalent in local currency at the prevailing interbank rate.
The underlying asset of the unit trust is the Mosi-oa-Tunya gold coins issued by the RBZ.
Bard Santner Investors is the fund manager while CABS is the trustee. A minimum of 80% of the fund is invested in gold coins with the balance in near-cash securities.
The asset manager said it had turned to gold as it is a defensive asset and withstand market and exchange volatility prevalent at the material time. It said global uncertainties brought about by wars and pandemics have seen gold prices increasing by 50% between 2017 and 2022 while global production has shrunk by 10% over the same period.
The introduction of the gold unit trust comes after RBZ governor John Mangudya exhorted the financial service sector to introduce new products riding on the gold coins.
“Insurance companies and banks can make other products out of these gold coins. They can do gold unit trusts where they do aggregation, the likes of Old Mutual, Zimnat and others. This is an opportunity for them to also make money out of this product whereby they can come up with unit trusts. Unit trusts mean an aggregation of those who are not able to buy at $1800,” Mangudya said at the launch of the gold coins in July.
