A leading figure at ETF Securities claimed yesterday (January 15th) that investors are moving to buy physical gold as concerns over the economy persist, Reuters reports.
The yellow metal increased by over 40 per cent in sterling value last year and by five to six per cent in dollar terms as financial institutions wobbled under the weight of the credit crisis.
Now Nicholas Brooks, head of research at the London-based firm, has explained that investing in gold is set to stay on the rise as it provides a store of wealth in uncertain times.
He told the news provider: "The key factor driving this is safe haven demand. Most of the flows we are seeing are going into our physically backed products, which is a pretty clear indication that people are buying because they are concerned about counterparty risk, the financial system and the outlook for currencies."
Mr. Brooks' views were echoed last week by major US bank Merrill Lynch, which was taken over by Bank of America this month.
Chief investment officer Gary Dugan explained in an interview with the Daily Telegraph that physical gold investment is proving popular with the bank's customers.
"It is amazing how many clients want physical gold," he told the newspaper. "They are so worried, they want a portable asset in their house."
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