Gold ETF Holdings at Record High


"Prices heading for 10th straight annual increase. . ."

Gold held in ETF Securities Ltd.'s European exchange-traded products rose to a record $10 billion, accounting for half of the provider's total global assets under management.

Its ETFS Physical Gold product held $5.2 billion of metal as of June 11, and ETFS Gold Bullion Securities contained $4.8 billion, London-based ETF Securities said today. Total assets under management climbed to an all-time high $20 billion as of June 17, including commodity, currency and equity products, up 70% from last July, it said.

Gold ETP holdings advanced to an all-time high this year and coin sales from mints accelerated on buying by investors seeking to protect their wealth from Europe's sovereign-debt crisis and on concern the global economic recovery may falter. Bullion climbed to a record $1,265.30/oz. on June 21 and is up 15% this year.

European investors' demand for hard assets, particularly precious metals, continues to grow as they look to reduce their exposure to counterparty and currency-depreciation risks, Hector McNeil, a managing partner at ETF Securities, said in the report. Demand for the ETFS Physical Gold product has been particularly strong since the euro crisis began.

Its two bullion products are the biggest gold-backed securities in Europe, ETF Securities said. The company also provides precious-metals products in the U.S., Australia and Asia.

Global holdings of the metal in ETPs increased four metric tons to 2,062.6 tons on June 25, according to Bloomberg. Holdings in the U.S.-based SPDR Gold Trust, the world's biggest exchange-traded fund backed by bullion, were 1,316.18 tons on June 25, valuing its assets at $52.28 billion.

Gold for immediate delivery traded at $1,259.15/oz. at 11:17 a.m. in London and is up 15% this year. Prices are heading for a 10th straight annual increase, the longest run since at least 1920.

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