Finance professionals have been clamouring to purchase physical gold and silver coins amid severe political and economic uncertainty, with demand surging 618% in October (compared to the monthly average of the last 12 months).
They cite a litany of concerns including escalating inflation, the energy crisis, rising interest rates and household debt, all compounded by the impact of a fragmented and divisive political party and government.
Finance professionals at the front of the queue
This rise in demand is significant because over half the clients currently investing in gold through Arabian Pure Gold work within the financial sector (banking, insurance, accountancy). A key motivating factors In their decision to purchase gold right now is the extreme market volatility in both equities and property, along with systemic counter-party risk that may come as a consequence. Some bankers have even expressed concern about the banks they work for, reflecting a worrying trend of finance professionals with inside knowledge of the industry moving some of their assets away from the banking industry.
That’s not to say they don’t think opportunities will exist in equities and property. Rather they recognise that it’s all about timing, specifically buying after the markets have fallen instead of during its collapse. In the meantime, investors have become wealth custodians, intent on preserving and protecting their savings during these uncertain times, ready to take advantage of opportunities when the time is right. Financial professionals understand that whilst gold will not provide a dividend like equities, it does have a track record as a safe-haven asset and wealth protector.
Discover Gold’s Unique Tax Advantage
Most investments are subject to some form of taxation, but physical gold can be totally free of VAT and capital gains tax.
Pension pickup
One notable observation is a 73% increase in people removing exposure to equities within their pensions and SIPP in order to purchase physical gold bars within the same vehicle. Clients are concerned that another major fall in the equity market could remove 10 years from their retirement pot (or add 10 more years to their work life). Investing in gold allows pension owners to ride out the peaks and troughs of market volatility and lowers risk as they near retirement age.
Coins in short supply
Supply at times has been a struggle, with high demand for the limited number of new coins being produced by The Royal Mint contrasted with flurries of clients selling older coins. It has become very difficult to manage demand and supply in the same way as in previous crises and certain coins are now very hard to come by. Our buy back guarantee means we can rely on our existing clients as a source of stock and therefore this has affected us far less than most other companies.
Gold is a long-term asset that has maintained its value for centuries. In uncertain times it provides security and allows you to protect your wealth from tumult, which is why now is a good time to consider adding gold to your portfolio.
