Industry Updates

Gold ETFs dominate inflows as coronavirus spooks investors

Tom Eckett

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Gold ETFs were the most popular products among European investors last week amid fears the coronavirus could have a long-term impact on the global economy.

According to data from Ultumus, five of the top 11 ETFs, which saw the most inflows in the week to 6 March, were gold products.

On top of the pile was the Xtrackers Physical Gold ETC EUR (XAD5) which saw inflows of $359m, the most across all ETFs listed in Europe.

The Invesco Physical Gold ETC (SGLD) was the second precious metal product to feature in the top 10 with $179m inflows.

The Amundi Physical Gold ETC (GOLD), the iShares Physical Gold ETC (SGLN) and the WisdomTree Physical Swiss Gold ETF (SGBS) were also among the products with the most inflows.

The inflows come as gold prices hit the $1,700 an ounce mark for the first time since 2012. Overall, these five ETPs saw $948m inflows last week.

Gold inflows are a clear sign investors are looking for extra protection amid the coronavirus uncertainty.

The coronavirus has now infected over 100,000 people causing almost 4,000. This has spooked global markets which have entered correction territory.

The S&P 500 is down 12.2% from year-to-date highs after triggering a circuit breaker which temporarily pauses trading on the New York Stock Exchange (NYSE) if it falls more than 7%.

ETFs in Europe see record trading amid coronavirus uncertainty

Juan Carlos Artigas, director of investment research at the World Gold Council, commented: “We expect market risk and slowing economic growth interaction to impact gold prices, particularly as the financial effects of the coronavirus are realised.

“Additionally, lower interest rates, increased gold price volatility and central bank intervention could continue.”

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