After Covid-19 gave gold investors a lot to cheer about, the recent sideways movement may have them wondering whether more strength is ahead or whether the party is finally winding down. With more market uncertainty ahead like a presidential election that could bring volatile market swings, gold could be poised for more gains.
“Gold prices are set to spring higher after more than a month of moving sideways, according to one analyst,” a Fox Business report noted. “Drivers include a positive technical backdrop and the likelihood of sustained low interest rates in the world’s largest economies that may prompt investors to seek better returns in other ‘safe haven’ investments.”
“Gold has ‘worked off the momentum, sentiment and positioning extremes seen at the peak and looks set to resume its uptrend’ wrote Laurence Balanco of Hong Kong-based capital markets and investment group CLSA Ltd.,” the report added.
A Ton of Gold Exposure with OUNZ
Investors looking to get gold exposure without holding the physical shares, but with the option to do so in the future, can look at the VanEck Merk Gold Trust (OUNZ ). OUNZ seeks to provide investors with an opportunity to invest in gold through the shares and be able to take delivery of physical gold in exchange for those shares.
The Trust’s secondary objective is for the shares to reflect the performance of the price of gold less the expenses of the Trust’s operations. Each share represents a fractional undivided beneficial interest in the Trust’s net assets, and the Trust’s assets consist principally of gold held on the Trust’s behalf in financial institutions for safekeeping.
OUNZ can offer investors the following:
- Deliverability: VanEck Merk Gold Trust holds gold bullion in the form of allocated London Bars. It differentiates itself by providing investors with the option to take physical delivery of gold bullion in exchange for their shares.
- Convertibility: For the purpose of facilitating delivery, Merk has developed a proprietary process for the conversion of London Bars into gold coins and bars in denominations investors may desire.
- Tax Efficiency: Taking delivery of gold is not a taxable event as investors merely take possession of what they already own: the gold.
As mentioned, one of the key benefits of OUNZ is the ability to exchange shares of the ETF for physical gold. Per the fund’s website, if you’re an “investor interested in taking delivery of physical gold in exchange for your OUNZ shares (Delivery Applicants), you must submit a signed Delivery Application to Merk Investments LLC (the “Sponsor”).