Absa’s NewGold has achieved a Year-to-Date (YTD) growth of 36 per cent and presents a great investment opportunity on the Ghana Stock Exchange (GSE).
The NewGold Exchange Traded Fund (ETF), which was relaunched last year by Barclays Bank Ghana, a member of the Absa Group, has rallied on the back of rising global gold prices, which hit $1,500 per ounce for the first time in over six years.
The fund has proven to be one of the best-performing assets for both long term and tactical investors, particularly during these times of global economic uncertainty.
Highlights from the graph show that over the last 18 months, NewGold has gone from approximately GH¢56.51 to GH¢77.01 per security, according to a statement issued by the fund managers, Barclays Ghana.
“This represents a return of over 36 per cent. In contrast, the Ghana Stock Exchange Composite Index (GGSECI) has gone from GH¢2,579.72 to GH¢2,173.98, resulting in a decrease of 18.66 per cent.
NewGold was initially launched in 2004 by Absa in South Africa. At the time of its launch, it was the third commodity Exchange Traded fund (ETF) in the world and until recently, the only commodity ETF listed on the Johannesburg Stock Exchange (JSE).
It has secondary listings on stock exchanges in Botswana, Nigeria, Mauritius, Namibia and Ghana.
Absa listed NewGold on the Ghana Stock Exchange in August 2012 as NewGold (GLD) and is the only ETF listed on the GSE offering institutional and retail investors the opportunity to invest in the commodities market.
“It offers an investment vehicle which tracks the spot price of gold and is fully-backed by physical gold with each debenture equivalent to approximately 1/100th of gold bullion, which is held with a secure depository on behalf of investors,” the statement explained.
It added that the sterling performance this year was expected to continue as global risk drivers persisted.
“Key among these are the US-China trade war, easing monetary policy regime, geopolitical risks with the imposition of sanctions on Russia and Iran, Brexit and Hong Kong’s social unrest,” the statement said.
Investors in Ghana
While investors in Ghana continue to be fixated on government securities and chasing high yields in other investments, Barclays said NewGold presented a commendable approach to portfolio diversification and offered a great investment opportunity to sophisticated retail investors, asset and pension funds managers, among others.
NewGold is marketed by Barclays Bank in Ghana and can be acquired through a licensed stockbroker on the Ghana stock Exchange or IC Securities Ltd – the local market maker.