Local gold dealer GSC launches precious metals daily savings programme

Singapore

GOLD retailer GoldSilver Central (GSC) has launched a precious metals accumulation programme that allows investors to buy a bit of gold, or silver, every day over a period of at least three months.

The daily purchase takes away the stress of timing the market for investors and sets it apart from similar precious metals savings programmes by UOB and other retailers, it said.

Using a dollar cost averaging concept, investors can put in a sum as low as $5 each day under the programme. The amount will be used to buy gold or silver at 10am Singapore time every weekday, based on the spot price in the London trading market. This price is also shown to investors on the GSC website.

"The lower the price, the more metals you accumulate," said GSC managing director Brian Lan. "It's a daily purchase ... so you don't have to time the market to buy it."

After a cycle of three months, investors can choose whether to continue, or to take physical delivery of their metal holdings. For the latter option, however, there is a premium that will have to be paid; the amount varies depending on the type and brand of phy-sical precious metal chosen.

To safeguard investors' interest, the company collects payment on a monthly basis.

The programme, a first in Singapore, is the most cost effective and efficient way for one to acquire physical gold, said Albert Cheng, CEO of the Singapore Bullion Market who was also at the launch event. "This combination of accessibility and convenience will make physical gold more accessible to the general public, and can only be good for both investors and Singapore as well."

The World Gold Council, an industry lobby group, has introduced gold accumulation programmes in Japan and China.

In China, where six banks including ICBC have launched such a product, five to six million accounts have been opened with about 80 tonnes of physical gold saved, said Mr Cheng, who was previously managing director of the Far East at the World Gold Council.

In Singapore, precious metal savings programmes are also offered by local bank UOB and gold retailers BullionStar and Singapore Precious Metals Exchange (SGPMX).

UOB was the longstanding incumbent, having introduced gold and silver savings accounts 36 years ago, while the other gold retailers started their programmes in recent years.

The accumulation programmes share similarities in enabling investors to buy small amounts of precious metals without a large upfront sum. BT understands that these do not commit investors to purchasing the precious metals on a regular basis, or only on a monthly basis.

Buying precious metals every day allows investors to average out the volatility of the market, said GSC.