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Invesco seeks flows into its safe haven gold ETC by reducing fee

News Team, 18/12/2018

The battle to gain investors' assets into safe haven products has just intensified as Invesco is decreasing the annual fixed fee on its $4.5 billion Invesco Physical Gold Exchange Traded Commodity (ETC). It now has the lowest cost of any gold Exchange Traded Products (ETP) available in Europe.

The Invesco Physical Gold ETC has received $190 million of net inflows since 1 October 2018.

It is also the largest ETP in Europe. This comes at the same time when demand for gold is on the up during the past couple of months in light of heightened equity volatility and a more risk-off sentiment from investors,

This change in sentiment has been demonstrated by over $1 billion net new money going to all gold ETPs listed in Europe in 2018.  

According to the company “the Invesco Physical Gold ETC is designed to provide the performance of the gold price, less the annual fee. Investments are used to purchase physical gold bars, which are held in an allocated account and stored securely in the London vaults of J.P. Morgan Chase Bank.”

Invesco states it is more cost-effective compared to actually buying and holding gold as this involves arranging transportation, storage and insurance.

Many of Invesco’s ETCs already have the lowest ongoing charge figures (OCF) versus other competitors in Europe.

Chris Mellor, head of EMEA ETF commodity product management at Invesco, said, “Gold could provide useful diversification for investors who are worried about volatile equity markets and the possible impact of slowing economic growth, trade wars and Brexit.

“One of the big attractions of gold as an investment is that it tends to behave differently than other asset classes, especially equities. For investors considering adding exposure, we’ve just made it even more attractive from a cost perspective.”

Invesco has $980.9 billion in assets under management.

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