His latest venture, The Royal Mint Physical Gold Securities ETC (RMAU) listed on the EURONEXT exchange earlier this week. The ETC is designed to offer investors an effective way to access the gold market as it tracks the physical price of gold.
RMAU first listed on the London Stock Exchange in February 2020, and is also listed on XETRA and Borsa Italiana. RMAU is the first listed financial product to be backed by The Royal Mint – the world’s largest export mint and home of gold in the UK.
One issue with paper backed gold ETPs, of which there are many available, is the concern that the multitude of firms offering the products may not have the actual shiny metal to back these investments.
Hector McNeil
Mr McNeil has therefore partnered with the Royal Mint to issue, manage and distribute the RMAU ETC. The founders of HANetf have extensive knowledge of gold investment products and were co-founders and owners of the first company that invented gold exchange traded funds (ETFs) and other commodity ETFs.
The Royal Mint makes coins and precious metals investment products for the UK and internationally. It is one of the oldest companies in the world, with over 1,100 years’ experience of designing and making precious metals.
The beauty of this product is that it is 100 percent backed by London Bullion Market Association (LBMA) post 2019 Responsibly Sourced Good Delivery bars, the physical gold associated with RMAU will be held in The Royal Mint’s purpose-built vault – one of the UK’s most secure sites believed to be near Cardiff.
Nicola Howell, chief customer officer for The Royal Mint, said: “We are delighted that the RMAU will now be available to investors in France, and enable them to add gold from The Royal Mint to their portfolio. The introduction of an ETC was a significant milestone for The Royal Mint as we look to diversify our business for the future, whilst building on 1,100 years of trust and expertise in precious metals.”
Mr McNeil added: “We have been proud to work with a brand as prestigious as that of The Royal Mint to the launch of its first ETC. We are excited this ETC will now become available to investors in France.
“Gold ETCs have always been a popular way for investors to gain exposure to the gold price. The Gold is stored in The Royal Mint’s vault, one of the country’s most secure sites. The Royal Mint brand is synonymous with the security and reliability investors want to see from a gold ETC and makes it an attractive option for investors who are looking to hedge systemic risk."
Gold is often regarded as a safe haven investment in times of market stress and investors will now have the option to own an ETC that custodies the gold outside of the financial system. Most other gold ETCs custody their gold at commercial banks so the RMAU ETC offers an attractive alternative to investors looking to diversify their custody arrangements.
RMAU ETC securities can be redeemed in exchange for physical gold bars and coins, with delivery and storage provided by The Royal Mint. This is a unique feature of the RMAU ETC. This is not available to UCITS funds.
A product that allows investors to trade their paper gold for the real thing should be expensive. However, the TER for the RMAU ETC is just 22 basis points per annum.
HANetf is fast becoming a go to firm for thematic ETFs and other types of exchange-traded products, which may worry some of the well-established players who have controlled that segment of the ever-popular market for some time.
With traditional active management houses going to great expense to build their own ETF offering, Mr McNeil offers another way. A cost-effective way for firms to jump on the passive bandwagon (ETFs enjoyed another record year of inflows last year) without needing to set up the infrastructure to do so.
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