Gold’s allure isn’t relegated to just China demand and central bank buying. The World Gold Council, in an insights report, highlighted the growing demand from North America investors with an eye on the precious metal’s fundamental benefits.
“We recently commissioned a survey of 525 North American professional investors – a mix of large institutions, consultants and financial advisors – the results from which confirmed a growing trend of gold ownership among this audience,” wrote Louise Street, senior markets analyst for the WGC. "A staggering 85% reported an allocation to some type of gold investment, up from 69% in 2018 and 76% in 2019 (Chart 1).
Gold ownership among North American professional investors has risen
% of respondents with an allocation to the meta
The metal’s prices have risen to as much as 13% this year. Associated indexes like the S&P GSCI Gold index have hit 22% for the year over halfway through 2024. The attraction to gold is largely attributed to the typical reasons for exposure to it. Those include diversification of assets and hedging against inflation.
“These investors have perceptions around gold that are comfortingly familiar to us and confirm that gold’s core attributes are, on the whole, well recognized,” Street added. “The majority of respondents view gold as an excellent portfolio diversifier and inflation hedge. [They] agree that it reduces portfolio risk.”
2 Ideal Ways for Exposure
Investors who want exposure to the yellow metal without the logistical requirements of storing the asset itself may want to consider the Sprott Physical Gold Trust (PHYS ). But an investor might want a more tangible investment experience. If so, they can convert their shares of PHYS into physical bullion. This offers feasibility and flexibility when it comes to adding the precious metal to a portfolio.
An alternate play on gold’s prices via ancillary services like mining offers opportunities in the Sprott Gold Miners ETF (SGDM ). The ETF seeks investment results that correspond generally to the performance of the Solactive Gold Miners Custom Factors Index. This index tracks the performance of large gold companies found on Canadian and major U.S. exchanges.
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