The Pure Gold Company
The Pure Gold Company quoted by James Connington of the Telegraph on price rises and days of heavy trading immediately following the results of the US election.
By James Connington
Sales of gold bullion and coins soared as investors dashed for safety in the wake of Donald Trump’s election victory, dealers reported.
BullionVault, the online bullion market, reported £4.1m of dealing in the three hours between 3am and 6am GMT, as certainty grew of the election outcome.
This was greater than the trading volume for the entire previous day.
Buying outweighed selling by a ratio of three to one during this period, the broker said.
Institutional buyers joined in and gold experienced its biggest rally since the Brexit vote, climbing 5pc to $1,333 (£1,076) per ounce in the morning, before stabilising at $1,300 (£1,050).
This is 26pc higher than at the start of the year, but remains well below the all-time $1,838 (£1,484) peak of 2011.
A rival dealer, the Pure Gold Company, said the size of average purchases also rose, up 23pc to £13,000. The day’s largest order, worth £515,000, was placed shortly after the outcome was announced.
High levels of trading were a feature of the whole of the past week, BullionVault said, with transactions roughly double those of last year.
BullionVault’s service allows investors to own physical gold via an online marketplace, meaning they do not have to take physical possession of the metal.
But services which deliver bullion and coins to clients, such as CoinInvest, also reported a sharp increase in buying activity.
CoinInvest said volumes were up tenfold.
Daniel Marburger, director, said the majority of client calls came in at around 5am. He said: “My sales team reported an increase from new customers, who are new to gold and silver, but who were wanting to hedge their portfolios. The split between new and returning customers was half-half.”
Among British investors the most popular coins tend to be Gold Britannias, Sovereigns and Silver Britannias.
Elsewhere in Europe, coins closely linked to the gold spot price are favoured, such as the one ounce Krugerrand.
Mr Ash said that by mid-morning trading had quietened down and that volumes were in any case far lower than at Brexit, when a large number of long-term investors had seized the opportunity to sell.
Brokers also reported brisk trade in the shares of bullion-back exchange-traded funds, such as ETF Securities Physical Gold.
Other factors were supporting the gold price, analysts said, including the decision overnight by India to cancel its largest-denomination 1,000 rupee note, a move aimed at reducing money laundering.
This will encourage greater use of the precious metal as a store of wealth in a culture where gold is already prized and widely owned, commentators said.
Source: The Telegraph