Deutsche Börse has just released fresh news from its commodities sector. The assets under custody of Xetra-Gold exceeded the 10 billion Euro mark for the first time. The physical holdings of the Gold ETC are deposited in the central vault for German securities in Frankfurt and are currently 209.98 tonnes, up 6.39 tonnes since the beginning of the year.
Steffen Orben, Managing Director of Deutsche Börse Commodities GmbH, the issuer of Xetra-Gold, commented on the news:
The new record corresponds to the increased gold price, but also to a very strong demand. With the continuing uncertainty and significant rises on the stock markets, institutional as well as private investors have increased their gold holdings for hedging purposes. According to various studies, five to ten percent of gold is reasonable as an admixture to the portfolio.
Gold holdings always increase when investors buy Xetra-Gold shares via the stock market. Exactly one gram of gold is deposited in the central vault for each share certificate.
With gold ETCs, investors benefit in particular from the low trading costs via the stock exchange. The bid-ask spread of Xetra-Gold is just a few cents.
The flexible exchange trading of gold-backed ETCs is a decisive advantage compared to owning physical gold. Even small quantities can be purchased at wholesale prices,” Orben explains.
Since the introduction of Xetra-Gold in 2007, a total of 5.17 tons of gold have been delivered. The gold holdings of the exchange-traded bearer bond increased with seven more tonnes in 2018 to 181.47 tonnes.
End of last year, Xetra-Gold was successfully launched in the Nordic countries Denmark, Finland, Norway and Sweden. The first broker to offer Xetra-Gold is Nordnet.