– ETF Securities enters the Australian investment market …
- Four new exchange traded commodities (ETCs) to be listed on the Australian Securities Exchange
- Silver, platinum, palladium and a precious metal basket ETC to be available to Australian investors for the first time
- Purchase of Gold Bullion Securities Ltd (ASX Code – GOLD)
The global pioneer in exchange traded commodities (ETCs), ETF Securities, today announced that it intends to list a range of physically-backed, precious metal, exchange traded commodities on the Australian Securities Exchange. This is the first time that silver, platinum, palladium or a precious metals basket have been made available to Australian investors through ordinary brokerage accounts.
ETF Securities has also formally completed the acquisition of the world’s first gold ETC – Gold Bullion Securities, listed on the Australian Securities Exchange (ASX:GOLD).
The four metal securities to be listed are:
- ETFS Physical Platinum
- ETFS Physical Palladium
- ETFS Physical Silver
- ETFS Physical PM Basket
First dealings in these securities are expected to commence on the ASX in December 2008.
ETCs are designed to offer investors a simple, cost-efficient and secure way to access the precious metals market. They provide investors with a return equivalent to movements in their spot price less a small annual management fee, which accrues daily.
Similar to Exchange Traded Funds (ETFs), ETCs are open-ended securities, which can be created or redeemed on demand (by market-makers) provided the relevant amount of metal is delivered to the custodian. Investors can buy and sell ETCs through regulated brokers or approved market makers; they can be traded in the same way as equities, including market, limit and stop orders. They can also be shorted through stock borrowing or CFDs. The minimum trade size is one security and settlement is T+3 (trade date plus three business days). The management of ETF Securities created the world’s first ETC, Gold Bullion Securities, which is listed in Australia and London and has over A$4.5 billion of assets. The new ETCs are backed by physical allocated metal held by the custodian HSBC N.A., the world’s leading custodian for ETCs with over A$30 billion of precious metals held for such products. All physical metals held with the custodian must conform to the rules for good delivery of the London Bullion Market Association (LBMA) and London Platinum Palladium Market (LPPM).
ETCs have been around since 2003, when the first one, Gold Bullion, listed on the ASX. Now there are A$8.6 billion of ETCs. They are relatively new investment tools, which enable investors to gain exposure to commodity prices without trading futures or taking physical delivery. Australian Graham Tuckwell is the founder and chairman of the ETF Securities group of companies. He is also the founder and chairman of Gold Bullion Securities Limited in Jersey and Australia, which obtained the world’s first listings of a commodity on a stock exchange. Previously, Graham was the founder and managing director of Investor Resources Limited, a boutique corporate advisory firm.
Source:ETFWorld.co.uk – ETFSecurities
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