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Strong Start to 2010 with $400mn of ETC Inflows Globally, New Records in Precious Metal Holdings as Gold Hits All Time High in Euro Terms
17/02/10
- $400mn of global net inflows YTD
- Global physical palladium holdings reach 1.1mn ounces, a world record
- Gold closes at record high above €813/oz yesterday, higher at start of London trade today
- Long Oil ETCs see strong inflows - $143mn over the past four weeks
- Investors see value in grains – wheat inflows already one-quarter of 2009 total
ETF Securities (ETFS), the global pioneer in Exchange Traded Commodities (Commodity ETCs), 3rd generation Exchange Traded Funds (ETFs) and Exchange Traded Currencies (Currency ETCs) has seen a strong start to 2010, with $400mn of net inflows across precious metals, energy and agriculture over the first 6 weeks of the year.
ETFS long oil ETCs saw $49mn of inflows last week, taking inflows over the past four weeks to $143mn (equivalent to $79mn and $208mn respectively in effective inflows, allowing for the double exposure of leveraged oil ETCs). These inflows have coincided with a drop in spot oil prices towards $70/barrel. These flows contrast with strong inflows into ETFS Short Crude Oil (SOIL) seen at the start of 2010 as spot prices breached the $80/barrel mark. This switch in investor positioning suggests some investors are taking active tactical trading following range-bound trading in spot oil prices recently.
With regards to agricultural commodity ETCs, investor interest in grains continues, with YTD inflows into ETFS Wheat (WEAT) and ETFS Corn (CORN) making up 2 of the top 10 performers so far this year. WEAT has seen $26mn of inflows in the first six weeks of 2010, a quarter of the entire yearly inflows over 2009. ETFS Grains (AIGG) underperformed ETFS Softs (AIGS) by 46 percentage points in 2009, led by a 26% drop in WEAT. Recent inflows could represent some investor expectations of a catchup in wheat prices compared to other agriculture prices in 2010 after near record harvests across most major Northern Hemisphere exporters weighed on wheat prices in 2009.
Precious metals have seen the strongest inflows YTD, with global gold, silver, platinum and palladium holdings at, or exceeding peaks set in late 2009. Palladium physical holdings stand at 1.1 mn oz, a world record. In terms of returns, continuing weakness in the Euro helped push spot gold prices to a record high above €813/oz at close of trade yesterday. At the start of London trade today prices had pushed up higher towards €815/oz. ETFS physically-backed gold holdings have held near record levels of 8mn ounces since the start of 2010 despite more volatile spot prices recently. This resilient investment demand highlights the strategic nature of much of this investment, with physical holdings doubling to 8mn ounces over the past two years. Gold has returned over 160% in USD, EUR, GBP, AUD and Yen terms in the 10 years ended Dec 31 2009, making it one of the most consistently strong performing investment assets worldwide over the past decade.
Daniel Wills, Senior Analyst at ETF Securities commented:
“Our physically-backed platinum group metal ETCs recently launched in the US have seen an exceptionally strong start to 2010. With over half a billion dollars of inflows into these products during their first five weeks of trading, inflows into these products add to record inflows into our European products, ETFS Physical Platinum and ETFS Physical Palladium, during the course of 2009. With close links to emerging market growth via intensive use in autocatalyst technology, these metals have gained further prominence recently with the emergence of China as the world’s largest car market. Meanwhile, renewed concerns surrounding sovereign credit risk at the start of 2010 has helped underpin safe-haven demand for gold as a hedge against currency debasement and financial market dislocation. Oil and agriculturebased ETC flows suggest that tactical and value-based strategies are gaining prominence alongside more strategic long term holdings heading into 2010.”
For further information, please contact:
Helen Burden
Tel: +44 (0) 20 7448 4330
Email: helen.burden@etfsecurities.com
Notes to Editors:
ETF Securities is a provider of Exchange Traded Products (ETFs, Commodity ETCs and
Currency ETCs). The management of ETF Securities pioneered the development of ETCs, with
the world's first listing of an ETC, Gold Bullion Securities in Australia and London in 2003 and
then the world's first entire ETC platform which was listed on the London Stock Exchange in
September 2006.
ETF Securities now offers more than 180 Exchange Traded Products (ETPs). The ETPs provide
investors with a wide variety of investment strategies, with ETPs offering access to asset
classes such as equities, currencies and commodities with physical, long, forward, leveraged
and short exposure.
ETPs are simple to access as they are traded in five currencies (EUR, USD, GBP, JPY and AUD)
and listed on nine major exchanges globally including the London Stock Exchange, the New
York Stock Exchange, the Tokyo Stock Exchange, NYSE-Euronext Paris, NYSE-Euronext
Amsterdam, Deutsche Börse, Borsa Italiana, the Australian Securities Exchange and the Irish
Stock Exchange.
To learn more about ETF Securities go to: www.etfsecurities.com
This press release does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or
subscribe for, any securities (together the "Securities")of ETFS Foreign Exchange Limited, ETFS Commodity Securities Limited, ETFS Metal
Securities Limited or ETFS Oil Securities Limited or any shares (the "Shares") of ETFS Fund Company public limited company (the "Fund") or
any other shares or securities, nor shall it or any part of it nor the fact of its distribution form part of or be relied on in connection with any
contract or investment decision relating thereto. Any offer, invitation or solicitation shall be made solely by means of the relevant prospectus
(plus any supplements thereto) in the case of the Securities or the prospectus together with the relevant sub-fund supplement in the case of
the Shares (in each case the "Prospectus") and recipients of this advertisement who are considering a purchase of Securities or Shares
following distribution of the Prospectus are reminded that any such purchase should be made solely on the basis of the information contained
in such Prospectus. This advertisement does not constitute any recommendation regarding the Securities or the Shares.The communication of
this press release is not being made by, and this press release has not been approved by, an authorised person for the purposes of section 21
of the Financial Services and Markets Act 2000 (the "FSMA"). Accordingly this press release is not being distributed to, and must not be
passed on to, the general public in the United Kingdom. The communication of this press release or any other document issued in connection
with the offer and sale of the Shares or Securities is only being made to and directed at those persons in the United Kingdom falling within the
definition of Investment Professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order
2005 (the "Order"), or high net worth entities, and other persons to whom it may otherwise lawfully be communicated, falling within Article
49(1) of the Order or any person to whom it may otherwise lawfully be made (all such persons together being referred to as "relevant
persons"). The communication of this press release (or any other document issued in connection with the offer and sale of the Shares or
Securities) must not be acted upon or relied upon by persons who are not relevant persons. The Fund is a collective investment scheme for
the purposes of the FSMA and is a recognised scheme for the purposes of the FSMA. Persons distributing this press release must satisfy
themselves that it is lawful to do so. All applicable provisions of the FSMA must be complied with in respect of anything done in relation to the
Shares or Securities in, from or otherwise involving the United Kingdom.
This is not an offer of securities for sale in the United States. The Shares and Securities have not been and will not be registered under the US
Securities Act or any other applicable law of the United States. The Shares and Securities are being offered and sold only outside the United
States to non-US persons in reliance on the exemption from registration provided by Regulation S of the US Securities Act. None of ETFS
Foreign Exchange Limited, ETFS Commodity Securities Limited, ETFS Metal Securities Limited, ETFS Oil Securities Limited and ETFS Fund
Company public limited company (each an "Issuer") has been or intends to become registered as an investment company under the United
States Investment Company Act of 1940 (as amended) (the "Investment Company Act") and related rules. Neither the Shares nor the
Securities or any beneficial interest therein may be reoffered, resold, pledged or otherwise transferred in the United States or to US persons.
If an Issuer determines that any holder of shares is a US Person or any holder of Securities is a Prohibited US Person (being a US Person who
is not a "qualified purchaser" as defined in the Investment Company Act), the Issuer may redeem the Shares or Securities (as the case may
be) held by that Security Holder in accordance with the provisions described in the Prospectus. Neither the Shares nor the Securities may be
purchased with plan assets of any "employee benefit plan" within the meaning of section 3(3) of the United States Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), any "plan" described in section 4975(e)(1) of the United States Internal Revenue Code
of 1986, as amended (the "Code") or any entity whose underlying assets include "plan assets" of any of the foregoing by reason of an
employee benefit plan's or other plan's investment in such entity, which employee benefit plan, plan or entity is subject to Title I of ERISA or
section 4975 of the Code or any United States Federal, state, or local law or non-United States law that is substantially similar to the
prohibited transaction provisions of section 406 of ERISA or section 4975 of the Code (any such employee benefit plan, plan or entity, a
"Prohibited Benefit Plan Investor"). If the Issuer determines that any Security Holder is a Prohibited Benefit Plan Investor, the Issuer may
redeem the Securities or Shares held by that person in accordance with the provisions described in the relevant Prospectus.
“None of the index providers of the relevant ETFs referred to herein nor their licensors make any warranty or representation whatsoever
either as to the results obtained from use of the relevant indices and/or the figures at which such indices stand at any particular day or
otherwise. None of the index providers shall be liable to any person for any errors or significant delays in the relevant indices nor shall be
under any obligation to advise any person of any error or significant delay therein.” “Dow Jones,” “UBS”, DJ-UBSCISM,”, “DJ-UBSCI-F3SM,”
and any related Indices or Sub-Indices are service marks of Dow Jones & Company, Inc. (“Dow Jones”) and UBS AG (“UBS”), as the case may
be, and have been licensed for use by the Issuer. The Securities although based on components of the Dow Jones UBS Commodity Index 3
month Forward SM (formerly known as the Dow Jones –AIG Commodity Index 3 Month Forwards SM) are not sponsored, endorsed, sold or
promoted by Dow Jones, UBS, or any of their respective subsidiaries or affiliates, and none of Dow Jones, UBS, or any of their respective
subsidiaries or affiliates, makes any representation regarding the advisability of investing in such product. ETF Securities Limited and each
Issuer are regulated by the Jersey Financial Services Commission.
ETF Securities Limited, ETFS Foreign Exchange Limited, ETFS Commodity Securities Limited, ETFS Metal Securities Limited, ETFS Oil
Securities Limited, and Gold Bullion Securities Limited are each regulated by the Jersey Financial Services Commission. ETFS Fund Company
PLC is regulated by the Financial Regulator in Ireland.
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