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Castlestone prepares precious metals UCITS launch

May 22, 2011
- 1:30 pm

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Ahead of the proposed launch of Castlestone Management’s Aliquot Precious Metals UCITS fund on May 31, the firm’s CEO Angus Murray has been expounding the virtues of holdi

Ahead of the proposed launch of Castlestone Management’s Aliquot Precious Metals UCITS fund on May 31, the firm’s CEO Angus Murray has been expounding the virtues of holding precious metals as a currency hedge. He expects to see significant devaluation of money in the next decade as a result of quantitative easing carried out by banks and believes precious metals can hedge against this devaluation in a client’s portfolio. “For investors previously unable to access real assets, this fund is the only UCITS regulated product to gain exposure to precious metals,” said Murray. The firm will allocate 80 per cent of the fund’s portfolio across the precious metals complex of gold, silver, platinum and palladium. The other 20 per cent will invest in copper, aluminium and zinc.

Perhaps unsurprisingly, gold, at 30 per cent, will have the highest weighting. These metals will be accessed via the Barclays Capital Diversified Precious Metals Index – a basket of futures constructed by Castlestone and compiled by the investment bank specifically for the new UCITS. The APM fund will be rebalanced on a quarterly basis and hedge currency risk to dampen price swings between Euro, Sterling and USD-denominated assets. “Strong supply and demand fundamentals, combined with ongoing geopolitical risk, will only add to the attractiveness of precious metals in the decade ahead,” said Murray, adding that the fund would give financial intermediaries the ability to invest in precious metals in a transparent and regulated format.

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