Gold as a diversification tool, also in 2023?

Thematically oriented global equity funds, such as DJE – Gold & Ressourcen, offer good access and can be a bit of a hedge against inflation and crises for investors.

Stefan Breintner, Head of Research and Fund Manager at DJE – Gold & Ressourcen

2022 has been a challenging year in the stock and bond markets. The price of gold also experienced complex months. More gold was withdrawn from index funds in 2022 than in almost every previous year. The Federal Reserve’s tight monetary policy and the resulting rise in bond yields have weighed on gold, which pays no interest. Real interest rates have also risen, albeit from low levels. Periods of rising real interest rates have generally negatively affected investment demand for gold in the past. Other types of investors, especially central banks, have taken advantage of the lower prices to buy. In the months of July to September,

Inverse interest rate curves, as observed for several months in the US, often herald a recession. Gold has always performed well during times of financial instability and also , for example, when emerging markets rise , since a lot of gold is traditionally bought there. An increasing normalization of the Chinese economy should also have a boosting effect on gold demand, as jewelry demand in one of the world’s largest consuming countries could pick up.

Outlook for 2023

The outlook for gold in 2023 is quite positive, which works in favor of adding it to a well-diversified portfolio. We continue to view gold primarily as a portfolio diversification tool, and even more so for 2023 , which is likely to be another challenging year for investors. However, like all asset classes, commodities such as gold also have their risks, so investments in commodities are suitable only as part of a portfolio and an investment in broadly diversified equity funds should be prioritized. direct investment in shares.

Thematically oriented global equity funds, such as DJE – Gold & Ressourcen (LU0159550077), offer good access and can be a bit of a hedge against inflation and crises for investors. The concentrated portfolio of 50-70 shares, focuses on shares of companies active in the extraction, processing and trading of gold. For diversification purposes, stocks from a broader commodity universe are added, such as diversified mining groups, non-ferrous metals, oil and gas. The strategy is index agnostic and can dynamically vary its allocation to gold mining stocks between 30 and 100%. With gold as its investment focus, the fundoffers diversification and less correlation with traditional investment strategies . Gold producers with no debt, with competitive cost structures, who can generate free cash flows (FCFs) even at lower gold prices are preferred. In raw materials, as in other segments, it is important to find undervalued niches that are not yet recognized by the market. This requires fund managers who are active and have the tools to anticipate these different cycles.

Altment Capital Partners represents DJE Kapital exclusively in Iberia.

Legal information

This is a marketing advertisement. Please read the relevant fund’s prospectus and KIID before making a final investment decision. It also contains detailed information on opportunities and risks. These documents can be obtained free of charge in German at www.dje.de under the corresponding fund. A summary of investor rights in German can be accessed free of charge in electronic format on the website at www.dje.de/summary-of-investor-rights. The Funds described in this Marketing Announcement may have been notified for distribution in different EU Member States. Investors should note that the relevant management company may decide to discontinue arrangements it has made for the distribution of units of its funds in accordance with Directive 2009/65/EC and Article 32a of Directive 2011/61 /EU. All information posted here is for your information only, is subject to change, and does not constitute investment advice or any other recommendation. The only binding basis for the acquisition of the corresponding fund are the documents mentioned above together with the associated annual report and/or semi-annual report. The statements contained in this document reflect the current assessment of DJE Kapital AG. Opinions expressed may change at any time without notice. All information in this summary has been provided with due care in accordance with the state of knowledge at the time of preparation. However, no guarantee or liability can be assumed for the accuracy and completeness.