HANetf has launched three FX hedged responsibly sourced physical gold exchange-traded commodities in partnership with the Royal Mint.
The three new ETCs follow The Royal Mint Responsibly Sourced Physical Gold ETC (RMAU), HANetf’s first listed financial product in partnership with The Royal Mint.
Gold is quoted in USD, which means most gold products are providing exposure to gold in USD unless they are hedged.
An investor who only wants to benefit from the gold price rising and has no – or a negative – outlook on US-Dollar, needs to find a way to hedge their US-Dollar exposure. In currency hedged products, the US-Dollar positions cancel each other out. This leaves the investor solely exposed to gold prices, the desired outcome.
Each of the ETCs will be backed by physical gold bars custodied by The Royal Mint at their highly secure vault in Llantrisant, Wales. This means the gold is held outside the London banking systems, providing a potentially attractive option for investors seeking real diversification in their gold custody arrangements, compared to most gold ETPs which custody at banks in or near London.
The FX hedging will occur daily, with the day’s FX profit and loss being converted into gold, minimising FX hedge counterparty risk.
Andrew Dickey, Divisional Director of Precious Metals at The Royal Mint, comments: “We have listened to what our investors want and we’re taking some exciting steps to expand our financial products offering, launching three new currency-hedged physical gold ETCs through HANetf.”
