Aberdeen Standard Opens New Front On Gold ETF Price War
(Kitco News) - A new front has opened in fee war among gold-backed exchange-traded funds; Aberdeen Standard Investments is now the market leader with the lowest services fees in the marketplace.
The international asset management firm announced at the start of the week that it lowed its service fee for its Physical Swiss Gold Shares (NYSE: SGOL) to 17 basis points from 39 basis points.
Steven Dunn, head of exchange-traded funds at the firm, said that the move was made to be more competitive as the precious metals sector grows.
“2018 has been relatively tough scenario for gold,” he said. “But we are starting to hear from investors a lot more conversations about gold.”
Dunn added that investors are becoming more price conscious and management fees are playing a bigger role in investment decisions. He added that Aberdeen’s latest move makes SGOL an attractive alternative asset.
Looking to 2019, Dunn said that the firm is expecting increased demand in more defensive assets like gold and other commodities as equity markets struggle to find momentum. Dunn’s comments come as gold prices trade at a five-week high as equities see declines of more than 1% across the board. February gold futures last traded at $1,245 an ounce, up 0.44% on the day.
“Gold is now on the radar as investors can expect to see more volatility in the marketplace,” he said. “We are confident in gold’s role in a portfolio moving forward. We just wanted to make sure SGOL was positioned as investors start to recognize gold’s attributes in the marketplace.”
Aberdeen is the third company to enter the gold-ETF price war, which started when GraniteShares introduced its low-cost gold-backed ETF (NYSE: BAR) last year. In the past year the firm has seen its gold assets under management grow to nearly $300 million.
Late in the summer, summer, SPDR introduced its Gold MiniShares ETF (NYSE: GLDM), which offered investors a low-cost gold product. Since its launch, its assets surpassed $300 million.