Swap your gold shares for coins, ETF firm offers

ETF Securities has teamed up with Government-owned coin maker Royal Mint to offer investors with shares in its leading exchange traded fund Gold Bullion Securities the option of cashing in shares for physical bullion coins. According to one spokesperson for ETF Securities, "giving investors the option to exchange their investments into physical assets provides a source of comfort."

By Kyle Caldwell
7:01PM BST 22 Aug 2013
The Telegraph

Index fund provider ETF Securities has teamed up with Government-owned coin maker Royal Mint to offer investors with shares in its leading exchange traded fund Gold Bullion Securities the option of cashing in shares for physical bullion coins.

Exchange traded funds have mushroomed in recent years as a highly popular way for private investors to own gold. Real holdings of gold, stored in bank vaults, are represented by shares which trade daily on the London Stock Exchange. This makes it possible for investors to buy and sell cheaply – and in relatively small quantities.

Investors can choose to receive Britannias or Sovereigns, at a cost of 4.5pc per transaction. Britannias are made from one troy ounce and minted from 22 carat gold, while Sovereigns weigh just under a quarter a troy ounce.

But the barriers to entry are high. Investors must stump up £8,250 – which equates to 109 shares in Gold Bullion Securities – to purchase a tube containing 10 Britannias. A tube of 25 Sovereign coins is cheaper at £4,800. There is no tax to pay on the switch, ETFS says.

ETF Securities has provided an online calculator to enable investors to covert the value of their shares into coins, which will be delivered one week after the transaction has been processed.

A spokesperson for ETF Securities said giving investors the option to exchange their investments into physical assets provides a source of comfort.

“Product innovation is a key element of our philosophy and as such this partnership with the Royal Mint is a natural fit. It has become increasingly important to reassure investors that their securities are backed by physical gold,” said a spokesperson for ETF Securities.

“This new service enables our retail clients to switch their holding knowing that their gold coins can be safely stored with or delivered by a UK government owned and regulated entity.”

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