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Inflows into gold ETCs resilient despite gold price declines, says ETF Securities


Flows into exchange traded commodities have risen for the fourth consecutive week, raising assets under management in ETF Securities’ ETC platform to USD10.3bn, an increase of USD3.2bn

Flows into exchange traded commodities have risen for the fourth consecutive week, raising assets under management in ETF Securities’ ETC platform to USD10.3bn, an increase of USD3.2bn so far this year.

Assets under management have nearly doubled since the middle of November driven by extremely strong flows into physically-backed gold ETCs, oil ETCs and – more recently – some of the more cyclically-oriented commodity sectors.

The largest inflows last week were into physically-backed gold ETCs, with the gold holdings of ETFS Physical Gold, Gold Bullion Securities and ETFS Physical Gold listed in Australia rising by 85,800 ounces (USD82m) to 7.4mn ounces (USD6.68bn). Gold holdings of these ETCs have increased by 1.4m ounces this year, the largest inflows in such a short period of time and 1.5 times inflows during the same period last year.

ETF Securities says it is interesting to note that flows into the gold ETCs have remained strong despite the recent fall in the gold price. This is not an anomaly, as last year during periods when the gold price was falling gold ETC flows also remained firm. The resilience of gold ETC flows indicates that most ETC holders are long term strategic investors, not highly sensitive to short term price swings and news flow.

The ETC that received the largest inflows last week was ETFS Agriculture, with USD47m of new flows, bringing total flows this year into this single ETC to USD168m, behind only gold, oil and platinum. Flows into agriculture have picked up sharply over the past three months as investors have become more confident about the sectors prospects and broadened their exposure to commodities more generally.

On a similar theme, ETFS All Commodities saw USD13m of inflows last week, the largest weekly increase since beginning of March.

Flows into energy ETCs remain positive but appear to be taking a breather from their blistering pace of the past few months. Total flows into energy ETCs were up USD21m last week with flows into ETFS Leveraged Crude Oil up USD8m, flows into ETFS WTI 2mth up USD9m, flows into ETFS Energy up USD7m and ETFS Crude Oil seeing outflows of USD11m.

With cyclical assets running strongly over the past few weeks, interest in industrial metals ETCs also continued to rise, with ETFS Industrial Metals  seeing USD4m of new inflows and ETFS Copper USD2m.

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