Gold coin unit trust to boost local savings

THE Government has applauded Bard Santner Investors, a local investment firm for making gold coins more accessible to the public through their Gold Coin Unit Trust.

On Monday, Bard Santner launched the Gold Coin Unit Trust, which will enable investors with as little as US$15, to buy gold coins, also known as Mosi-oa-Tunya.

The Reserve Bank of Zimbabwe (RBZ) launched gold coins in June last year, as an alternative investment instrument to ease pressure on the demand for the US dollar and mop up excess liquidity on the market which was destabilising the exchange rate.

In the first six months of 2022, runaway inflation saw people rushing to cash in their local dollars for the greenback and this fuelled the depreciation of the domestic currency.

Just like ordinary unit trusts, collective investment schemes involving the pooling of funds by a number of investors, the Gold Coin Unit Trust enables investors to invest a minimum of just US$120 per year and own a share of a gold coin.

Alternatively, investors can accumulate units at a rate of US$15 per month. The minimum investment period is 180 days and a withdrawal notice period of seven days is required.

At yesterday’s price of US$2 012.85 per gold coin (an ounce), one would need about US$200 to buy the smallest full gold coin, which is about a tenth of an ounce.

Speaking during the launch, Ministry of Finance and Economic Development communications director Mr Clive Mphambela described the units “as an innovation that shows how bold we are as a country” in developing innovative investment products.

Reserve Bank of Zimbabwe (RBZ)

“These principles are echoed in the product being launched today, with bold action and transformative is represented by policymakers that are aware of the fact that ‘business as usual’ cannot deliver a prosperous middle-income economy by 2030,” said Mr Mphambela.

“It takes boldness to cut through the noise and take action with conviction as Bard Santner has done in coming up with the product being launched today,” he added.

Mobilising of domestic factors was also a critical part of development as economies are built by pooling resources and directing them toward building the economy.

“That pooling of resources is very important. Within capital markets, the Collective Investment Schemes Act facilitates that function and it is most welcome to see more and more products being launched under the Act,” Mr Mphambela said.

Mr Clive Mphambela

Executive director of Bard Santner Dr Alfred Mthimkhulu said: “We cannot think of a more stable asset for our clients than gold. It also happens to be a resource, like numerous others, we have in abundance in Zimbabwe”.

‘‘We are keen to see our clients’ portfolios hold this stable asset humankind has ever known, from clients with as little as US$15 to save per month to those with thousands and millions.”

According to Dr Mthimkhulu, “this is Bard Santner’s understanding of empowerment, also their understanding of prudence in investment management.

“And of course, in doing this through the unit trust, we are promoting a savings culture in Zimbabwe as per the goal expressed by the central bank on the first issue of the coins.”

After savings were wiped out by hyperinflation in years leading to a multi-currency regime in 2009, there was a dearth of savings, with the banking public now preferring to keep their money under their pillows or buy assets such as residential stands.

Analysts say the Gold Coin Unit Trust offers a viable investment option for many people.
Gold coins have gained 10,36 percent since July last year trading at US$2 012.85 per ounce yesterday.
Spot gold was at US$1 917 per oz as published by the London Bullion Market Association Precious Metals Fix on Monday.-chronicle.cl.zw