Gold News

Meet the City's No.1 Crisis-Beating Fund Manager

The UK's best-performing fund manager of the financial crisis? A lump of Gold Bullion...

GOSH but how time flies! gasps Adrian Ash at BullionVault. This year will see the global financial crisis mark its 5th birthday.

And now the little blighter's out of short trousers, it's worth surveying the wreckage to see who coped best with the terrible toddler so far.

Let's start with the City of London's top fund managers. Who's made money for investors since 2007...?

The UK's Top Funds vs. Bullion: Annualized Returns in Per Cent

  1 year 5 year 10 year
Gold 16.72 26.07 18.18
Silver 1.74 22.44 20.03
Best UK fund sector Index-Linked Gilts Greater China Emerging Markets
Best sector's average 13.4 11.27 15.23
Single best fund 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

Compound annual growth rate, including dividends and annual charges. Bullion prices from London Bullion Market Association (16/12/11), storage costs from BullionVault. Sector data from Investment Management Association (12 months to end-Oct). Fund data from MorningStar (UK domiciled, non-institutional, 16/12/11).

Yes, any self-respecting analyst or advisor will rightly tell you to beware chasing yesterday's winners. But as you can see, for UK savers and investors, physical bullion – whether gold or silver – has proven to be uniquely suited to this financial crisis so far.

All told, over the 5 years to mid-December 2011, Gold Bullion priced in Sterling returned 218% net of ongoing storage costs. Physical silver rose 175% after storage costs. And the best-performing UK-domiciled fund available to retail investors? It 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 that's more than 3 times the return, for lower costs. And why?

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 – and better still Buying Gold – on the eve of this half-decade crisis than entrusting your savings to the City.

Past performance is no guarantee of the future. Only you can decide the best place for your money. If you are considering Buying Gold or physical Silver Bullion today, be sure to own what you buy – and don't one penny more than you need, only to get less than you want. Visit BullionVault to learn more...

Adrian Ash is director of research at BullionVault, the physical gold and silver market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and is now a regular contributor to many leading analysis sites including Forbes and a regular guest on BBC national and international radio and television news. Adrian's views on the gold market have been sought by the Financial Times and Economist magazine in London; CNBC, Bloomberg and TheStreet.com in New York; Germany's Der Stern; Italy's Il Sole 24 Ore, and many other respected finance publications.

See the full archive of Adrian Ash articles on GoldNews.

Please Note: All articles published here are 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. Please review our Terms & Conditions for accessing Gold News.

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