The #1 Fund Manager to Beat Financial Crisis: UK Edition

By: Adrian Ash | Wed, Jan 4, 2012
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How a lump of gold bullion beat the City of London's brightest and best since 2007...

HOW QUICKLY time flies! The global financial crisis will mark its 5th birthday in 2012.

And now it's out of short trousers, let's see who coped best with the terrible toddler so far, starting with the City of London's top fund managers...

The UK's Top Funds vs. Bullion: Annualized Returns in Per Cent¹
  1 year 5 years 10 years
Gold² 16.72 26.07 18.18
Silver 1.74 22.44 20.03
Best UK fund sector³ Index-Linked Gilts Greater China Emerging Markets
Best sector's average 13.4 11.27 15.23
Single best-performing fund⁴ Henderson
Long-Dated Gilt
Quadris Forestry BlackRock
Gold & General
Best fund's gain 31.63 17.03 22.38
No. of separate funds
beating gold
38 0 3
¹Compound annual growth rate, including dividends and annual charges
²Bullion prices from London Bullion Market Association (16/12/11), storage costs from BullionVault
³Sector data from Investment Management Association (12 months to end-Oct)
⁴Fund data from MorningStar (UK domiciled, non-institutional, 16/12/11)

 

Many analysts and advisors will rightly tell you to beware chasing yesterday's winners. But physical bullion has proven to be uniquely suited to this financial crisis so far.

Over the 5 years to mid-December, gold bullion priced in Sterling returned 218% net of ongoing storage costs. Physical silver rose 175% after storage costs.

The best-performing UK-domiciled fund available to retail investors returned 120% over the same period, including dividends and ongoing fees. Funds in the best-performing sector, Greater China, averaged just over 70% growth.

Those China equity funds cost an average maximum of 4.6% in upfront charges. Buying gold or silver on BullionVault costs a maximum 0.8% in dealing fees.

So why gold and silver - so far, at least - for UK investors and savers since 2007...? Because they are physical property, rather than anyone else's financial promise, gold and silver cannot go bust, unlike Britain's ailing banks or even neighboring governments across the Channel. Silver and gold bullion are also rare and tightly supplied, unlike the flood of money from the Bank of England, franctically trying to prop up the UK's banking system.

So despite all the experience and expertise of the UK's fund management industry, in short, you would have done much better buying silver or gold on the eve of this crisis than entrusting your savings to the City.

US comparison to follow on Friday.

 


 

Adrian Ash

Author: Adrian Ash

Adrian Ash
BullionVault.com

Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK's leading financial advisory for private investors, Adrian Ash is the head of research at BullionVault, where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.

About BullionVault

BullionVault is the secure, low-cost gold and silver exchange for private investors. It enables you to buy and sell professional-grade bullion at live prices online, storing your physical property in market-accredited, non-bank vaults in London, New York and Zurich.

By February 2011, less than six years after launch, more than 21,000 people from 97 countries used BullionVault, owning well over 21 tonnes of physical gold (US$940m) and 140 tonnes of physical silver (US$129m) as their outright property. There is no minimum investment and users can deal as little as one gram at a time. Each user's unique holding is proven, each day, by the public reconciliation of client property with formal bullion-market bar lists.

BullionVault is a full member of professional trade body the London Bullion Market Association (LBMA). Its innovative online platform was recognized in 2009 by the UK's prestigious Queen's Awards for Enterprise. In June 2010, the gold industry's key market-development body the World Gold Council (www.gold.org) joined with the internet and technology fund Augmentum Capital, which is backed by the London listed Rothschild Investment Trust (RIT Capital Partners), in making an $18.8 million (£12.5m) investment in the business.

For more information, visit http://www.bullionvault.com

© BullionVault 2006-2014

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events - and must be verified elsewhere - should you choose to act on it.

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Source: The Contrarian Take http://blogs.forbes.com/michaelpollaro/
austrian-money-supply/