Gold & Gold Backed Instruments: A Manageable Risk Worth Taking.
The gold price is the primary driver of earnings performance for gold-related products such as goldmine shares, ETF’s and gold-backed cryptocurrencies.
Even during the recent market correction, gold investments have lived up to their potential and have proven their defensive qualities.
Gold mining stocks, gold-backed assets as well as other gold-based auxiliary financial products on the other hand, have suffered disproportionate losses. This can be attributed, among other things, to poor quarterly reports from the mining industry.
The decline in the price of gold had a noticeable procurement fundamentally based on sentiment. The well-known names in the industry reported operational challenges such as labor shortages, flooded mine shafts or delays in the delays in the development of new mines as a result of supply shortages predicated on insufficient availability of the exploration equipment.
Despite these less than favorable conditions, the business remains lucrative. The exploration costs vary across the board but an estimated of USD 1,250 per fine ounce can be taken as an average benchmark, demonstrating that at today's gold price attractive margins still remain.
Despite these less than favorable conditions, the business remains lucrative.
The exploration costs vary across the board but an estimated of USD 1,250 per fine ounce can be taken as an average benchmark, demonstrating that at today's gold price attractive margins still remain.
In addition to the attractive current entry levels for gold mining stocks & gold-backed assets, for instance in the cryptocurrency sector, we see medium- to long-term potential for the precious metals market, despite the recent price weakness of gold.
Gold & Crypto
Historically gold and gold backed assets, such as cryptocurrencies represent an opportunity to benefit from the development of the price of gold. Irrespective of the risk averseness of the potential investors, this segment and its auxiliaries, remains one of the most deflationary propositions even in the face of current market turmoil and adversities, simultaneously shielding one’s capital from being too exposed to the risk factors innate to individual securities.
The most recent market data and analysis show an interesting correlation between the underlying asset, gold and several modern financial instruments, which capitalize on the historical qualities of this fine material, blending it with modern financial market solutions, propelling into the future. On many instances the combination of classical values and state of the art modern financial solutions are shielded and take refuge under the umbrella of Swiss Trust Company, a vehicle which transcends not only security, stability and safety, but also allows to operate in a virtually tax-free environment.
At First Fidelity Trust AG, we have taken a closer look at some of the available propositions and have found the presence significant synergies between the classical economic values of gold, the secure, stable nature of Swiss Financial Companies and the fresh, state of the art approach offered by technologies, such a secure ledger of the blockchain system.
Being based in Switzerland, we are by nature strong advocates and believers in the qualities of Swiss products and solutions. During our research we have come across several interesting and notable projects, one of which however struck us in particular.
A Cryptovalley based Swiss Corporation have found a way to combine the classical economic values of gold with the state-of-the-art blockchain technology, encapsulating what they call ‘The Gold-Standard on Blockchain’. The NovAu token, at first glance captures imagination and provides answers & solutions to the shortcomings and conundrums currently plaguing the financial & crypto markets. This proposition based on segregated gold bullion stored in Swiss vaults by the parent company SBCM AG backing
