Gold has been one of the year’s best-performing assets, with a return of 34 percent for the year to 5 August 2020, the day the gold price broke through the $2,000/ounce mark.

Analysis by Invesco shows that gold exchange-traded products listed in Europe raised more than $10 billion of net new assets in the first seven months of 2020, including $1.4 billion in July. The Invesco Physical Gold ETC accounted for more than 50% of the flows during the latest month and is now over $14 billion of assets.

Gary Buxton, Head of EMEA ETF at Invesco, said: “For more than a decade, our gold ETC has provided investors with an efficient way to gain exposure to the performance of the gold price. As the ETC has grown significantly in size, we have been able to share some of the economic and operational advantages with our investors. We are now doing this again with a fee cut.”

Invesco has reduced the fee on its Physical Gold ETC to 15 basis points per year from 19 bps. This lower fixed fee, combined with the tightest bid-offer spreads of any competing product, provides investors with the lowest total cost of ownership of any gold exchange-traded product in Europe.

In preparing the release of Invesco’s Q2 Gold Report, the firm points to the drivers of gold in the first two quarters being continued through July and into the first week of August. Looking further out, Invesco believes the risk of inflation could become yet another support for the gold price.

Chris Mellor, Head of EMEA Equity and Commodity ETF Product Management at Invesco, said: “Gold has been driven by not only the economic impact of the pandemic but also the reaction of central banks to the crisis. Low to zero interest rates, negative-yielding debt, ballooning central bank balance sheets, these are all factors that should favour holding real assets such as gold, especially at a time of such uncertainty. And gold exchange-traded products have given investors an effective way to gain exposure in their portfolios.”