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3 REASONS TO CONSIDER AN ACTIVELY MANAGED ALLOCATION TO GOLD AND SILVER
Central banks are also injecting vast amounts of stimulus into the system, swelling their balance sheets to extreme levels. And unlike in 2008, this money is flowing into the real economy.
History tells us the result could be inflation – with negative real interest rates and a devaluing of fiat currencies.
If the Federal Reserve were to enact even more extreme monetary policy, such as Modern Monetary Theory or ‘helicopter money’ to support government spending plans, that would be further bullish for gold as a tool to hedge against inflation.
The gold price typically moves inversely to ‘real’ interest rates – the rate of interest excluding the effect of expected inflation. In this way, it can help to defend a portfolio against the effects of inflation.
Real interest rates in the US have turned negative, meaning that many US Treasury bondholders face losses in post-inflation terms, revealing gold and silver as the stores of true value. We see this trend continuing, and it is an ideal environment for monetary metals.
‘Shrinkflation’ where products become smaller but cost the same, is a well-known phenomenon. It is harder to track than simple price rises but is a good example of how inflation can appear from ‘out of the blue.’
- The fund manager aims to outperform gold to help allocators generate meaningful attribution
- Flexible and dynamic strategy that allocates to gold and silver bullion, and mining equities
- De-risked approach to investing in bullion and mining equities
Actively blending silver with gold
The manager aims to add value by increasing exposure to silver when prices are rising, and reducing exposure when prices are falling.
Active exposure to gold and silver mining company shares, alongside bullion
As with the blending of gold and silver, the mix of exposure to mining shares and the metals themselves is actively managed with a view to adding value as market conditions evolve.
Lower energy costs combined with rising gold and silver prices have made operating margins for gold and silver mining companies extraordinarily attractive.
WHY ALLOCATE TO SILVER ALONGSIDE PHYSICAL GOLD?
Silver also has dual importance as an industrial component, as well being a monetary store of value.
There is growing demand for silver for use in green technologies, such as photovoltaic cells for solar panels, and it is widely used in electronics! Silver can be found in solar cells, water purifiers, touch screen & smartphones, electric vehicles and semiconductors.
- Investment risk – there is no guarantee that the Fund will achieve its objective. A capital loss of some or all of the amount invested may occur.
- Sector concentration risk – the Fund’s investments are concentrated in natural resource companies, and may be subject to a greater degree of risk and volatility than a fund following a more diversified strategy. Silver tends to outperform gold in a rising gold price environment and it tends to underperform gold when sentiment moves against the sector.
- Strategy risk – as the Fund invests in other collective investment schemes, which themselves invest in assets such as bonds, company shares, cash and currencies, it will be subject to the collective risks of these other funds. This may include emerging markets risk and smaller companies risk.
- Company shares (i.e. equities) risk – the value of Company shares (i.e. equities) and similar investments may go down as well as up in response to the performance of individual companies and can be affected by daily stock market movements and general market conditions. Other influential factors include political, economic news, company earnings and significant corporate events.
- Concentration risk (number of investments) – the Fund may at times hold a smaller number of investments, and therefore a fall in the value of a single investment may have a greater impact on the Fund’s value than if it held a larger number of investments.
- Smaller companies risk – smaller companies are subject to greater risk and reward potential. Investments may be volatile or difficult to buy or sell.
- Liquidity risk – some investments may become hard to value or sell at a desired time and price. In extreme circumstances this may affect the Fund’s ability to meet redemption requests upon demand.
- Currency risk – the Fund can be exposed to different currencies. The value of your shares may rise and fall as a result of exchange rate movements.
- Derivative risk – the Fund may use derivatives to generate returns as well as to reduce costs and/or the overall risk of the Fund. Using derivatives can involve a higher level of risk. A small movement in the price of an underlying investment may result in a disproportionately large movement in the price of the derivative investment. Derivatives also involve counterparty risk where the institutions acting as counterparty to derivatives may not meet their contractual obligations.
For a more detailed explanation of risks, please refer to the “Risk Factors” section of the prospectus.
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MARKETING MATERIAL ONLY. DOES NOT CONSTITUTE INVESTMENT ADVICE OR INVESTMENT RESEARCH.
Past performance is not a guide to future performance and may not be repeated. Investment involves risk. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested. Because of this, an investor is not certain to make a profit on an investment and may lose money. Exchange rates may cause the value of overseas investments to rise or fall.
IN AUSTRIA, FRANCE, ITALY, LUXEMBOURG, PORTUGAL AND SWEDEN: This communication is issued by Jupiter Asset Management (Europe) Limited, The Wilde-Suite G01, The Wilde, 53 Merrion Square South, Dublin 2, D02 PR63, Ireland.Jupiter Asset Management (Europe) Limited is registered in Ireland (company number: 536049) and is authorised and regulated by the Central Bank of Ireland (number: C181816).
IN THE UNITED KINGDOM AND ALL OTHER EEA COUNTRIES: This communication is issued by Jupiter Investment Management Limited, The Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ, United Kingdom. Jupiter Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 171847).
This communication provides information relating to Jupiter Gold & Silver Fund (the “Fund”), which is a sub-fund of Jupiter Asset Management Series plc. Jupiter Asset Management Series plc is an investment company with variable capital established as an umbrella fund with segregated liability between sub-funds which is authorised and regulated by the Central Bank of Ireland pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011, as amended. Registered in Ireland under registration number 271517. Registered office: 33 Sir John Rogerson’s Quay, Dublin 2, Ireland.
Jupiter Asset Management (Europe) Limited and Jupiter Investment Management Limited are collectively known as Jupiter. Jupiter uses all reasonable skill and care in compiling the information in this communication which is accurate only on the date of this communication. You should not rely upon the information in this communication in making investment decisions. Nothing in this communication constitutes advice or personal recommendation. An investor should read the Key Investor Information Document(s) (“KIID”) before investing in any sub-fund of Jupiter Asset Management Series plc. The KIID and the prospectus can be obtained from www.jupiteram.com in English and other required languages.
Certain paying and/or information agents have been appointed in connection with public distribution of the shares of Jupiter Asset Management Series plc in certain jurisdictions. Shares are sold by prospectus only. The prospectus, KIID and/or other relevant offering documentation is available free of charge at:
Austria: Erste Bank der oesterreichischen Sparkassen AG, Belvedere 1, 1010 Wien, Austria.
Belgium: CACEIS Belgium SA, B-1000 Brussels, Avenue du Port 86 C b320, Brussels.
Germany: GerFIS – German Fund Information Service UG (Haftungsbeschränkt), Zum Eichhagen 4, 21382 Brietlingen, Germany.
France: BNP Paribas Securities Services, Les Grands Moulins de Pantin, 9 rue du Debarcadère 93500 Pantin, France.
Hong Kong: Merian Global Investors (Asia Pacific) Limited, Suite 1706, Alexandra House, 18, Chater Road, Central, Hong Kong.
Italy: Allfunds Bank S.A.U., Milan Branch, Via Bocchetto, 6, 20123 Milano, Italia; Societe Generale Securities Services S.p.A, Via Benigno Crespi 19A – MAC2, Milan
Luxembourg: BNP Paribas Securities Services, Luxembourg Branch, 33 rue de Gasperich, L-5826, Grand Duchy of Luxembourg.
Sweden: Skandinaviska Enskilda Banken AB (“SEB”), Kungsträdgårdsgatan 8, SE-106 40, Stockholm, Sweden
Switzerland: First Independent Fund Services Ltd., Klausstrasse 33, CH-8008 Zurich is the Swiss representative and BNP Paribas Securities Services, Paris, succursale de Zurich, Selnaustrasse 16, CH-8002 Zurich is the Swiss paying agent.
Taiwan: Capital Gateway Securities Investment Consulting Enterprise, 9F/9F-1, No. 171, Songde Road, Xinyi District, Taipei City, Taiwan, R.O.C.
United Kingdom: Jupiter Investment Management Limited, The Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ, United Kingdom. The Fund is recognised by the FCA.
Other: Jupiter Asset Management Series plc, c/o Citibank Europe plc, 1 North Wall Quay, Dublin 1, Ireland.
In Denmark, this material is only intended for the exclusive use of Danish eligible counterparties or professional investors. Danish retail investors may not invest in the sub-funds mentioned in the material.
In Spain, Jupiter Asset Management Series plc is registered with the Comisión Nacional del Mercado de Valores (“CNMV”) under number 301. Jupiter Investment Management Limited is registered under number 2479. The prospectus, KIID and the latest economic reports can be obtained at no cost from registered distributors as per the list available on the CNMV web page.
In the Republic of Finland, this communication is not intended to constitute a public offer or an advertisement of securities.
In Italy, this material is for the exclusive use of “professional clients or professional investors” (as defined in Legislative Decree no 58/1998 by reference to Annex 3 of CONSOB Regulation no. 20307 of 2018) and its dissemination to retail investors/clients is prohibited.
In Luxembourg, this information does not constitute, under any circumstances, an offer or an invitation to purchase or sell shares in Luxembourg and does not and is not intended to constitute an offer of shares in the Grand Duchy of Luxembourg. It does not constitute legal, accounting, or tax advice.