The price of New gold Etf jumped 35% on Tuesday, its biggest one-day gain since February 11 2016. Trading at a price of N3,392 from its previous close of N2,500, the ETF generated a 35% return. That brings the MTD and YTD performance to 42.82% and 66.19% respectively.
It is quite a remarkable performance when weighed against other exchange traded funds, although the Vetiva Banking Etf has returned 28.94% YTD. Gold has been known to preserve wealth through economic depressions and stock market crashes, acting as a form of wealth insurance. That makes it a desirable asset class to hold in a portfolio. While Gold is an asset of great value, it is not readily accessible to Nigerian investors as an investment class. Gold ETF therefore offers investors an opportunity to benefit from the upticks in gold price.
In an era where the rate of inflation is over 15%, New Gold ETF may be a good hedge against the ugly effects of inflation.