Vaulted gold

Safe Gold (german vaulted gold) referred to in vaults under custody investment gold. Private or institutional investors purchase when buying gold vault ownership of physical gold. Unlike the purchase of gold bars or coins of investors buying gold safe even physical gold, but considers this not even in hands. However, he must have a delivery option, ie the investor can allow to deliver his gold for fee or pick up this at the deposit. In general, very few customers from this delivery option use.

Delineation of vaulted gold to other gold investments

Unlike with gold deposited funds or exchange traded commodities ( ETC) no investment instrument or security between the investor and the physical gold is connected with vaulted gold. Buyers of gold vault acquire direct ownership of gold.

Gold certificates are unlike fund and ETC not backed by physical gold, investors purchase certificates on the gold price only have a claim against the issuer but no ownership of gold.

History

It was originally offered in particular by banks private clients vaulted gold. In Germany and Switzerland Safe Gold was offered in the context of private banking almost exclusively to high net worth clients.

In addition to banks and large bullion dealers gold vault offers or based vaulted gold gold savings plans for private investors have developed. The first gold or other precious metals savings plans were, for example, introduced in Japan in the 1980s by the great noble house Tanaka Kikinzoku Kōgyō.

In addition to classic banks and precious metal dealers for several years also offer various direct provider vaulted gold - often on the Internet - at. Examples include the DAB bank AG and GoldRepublic from the Netherlands.

Properties

Buyer of vaulted gold investors acquire ownership of physical gold. Depending on the product configuration acquire the investors in the purchase of gold vault either partial ownership in gold bars or full ownership of individual gold bars or gold coins.

In high security safes mounted vaulted gold is usually insured and thus regularly kept safe as at home or even in the (bank) deposit box.

In contrast to so-called gold accounts where minimum investment amounts of 1,000 ounces of gold are required on a regular basis, some providers already offer vaulted gold in small quantities from 1 gram of gold and thus enable the average retail investors to purchase.

Unlike the purchase of gold bars and coins that are kept at home or in lockers, investors do not have to take care of the transportation or storage of gold in the case of vaulted gold.

In Germany physical gold and thus vaulted gold is weakly regulated and legally represents no financial product dar. In the Netherlands, however, centrally unallocated Bullion Gold treated as 'investment Object' and as such is subject to regulation by the Dutch AMF.

Costs

Investors usually contribute vaulted gold the following costs:

• Fees for the purchase and sale of gold
• When buying / selling bars and coins accumulating premiums and discounts over the gold price on the world market
• Running costs for the custody of the provider - particularly to the storage and insurance

Depending on the product configuration, the acquisition of vaulted gold due to the centralized purchasing of larger ingots be cheaper than the conventional purchase of investment gold to classic precious metal dealer. However, the costs can vary widely depending on the seller and product.

Risks

In addition to the market risk of an investment in gold owner of vaulted gold wear a market liquidity risk, which can be very different highly dependent on the specific supply and access the provider to precious metals trading.

Investors who acquire gold vault, also bear the risk that the provider or custodian or individual employee embezzled gold holdings or they are stolen by third parties. According to the World Gold Council, investors should therefore convince them that " Safe Gold supplier assure direct and unrestricted ownership of gold, give no gold without the prior consent of the customer, can keep the gold in an independent and registered vault operators and allow regular inspections and audits of the customers gold holdings ". In addition, the gold should be insured against the usual risks.

Criticism

In addition to the risks described above, an investment in gold safe, there is criticism of overpriced Safe Gold Gold offers and savings plans of some providers. For example, in the past, gold savings plans, which will invest in 1 gram gold bars, criticized on the gold value in the media due to the associated with the small size ingots high surcharges.