Lord Rothschild fund invests £12.5 million into BullionVault

Again: Only physical gold (held by you) is real, everything else is an illusion.

Is it safe in a bank?

James G. Rickards: Possible Run on the Gold Bank, Fed Insolvent, Currency Endgames in US Debt Crisis:

Holding your gold in a bank correlates you to the banking system, the very risks which you are trying to avoid

I would get out of BullionVault NOW and buy real gold instead.

This is not an investment advice!

£12.5m is NOTHING (but a red herring to make people – that don’t know anything about Lord Rothschild – believe that their investment is safe).

An investment fund backed by Lord Rothschild has joined the World Gold Council to put £12.5m into BullionVault, the online gold investment platform.

Investment demand for gold has risen on concerns that sovereign debt problems could spread

Tim Levene of Augmentum Capital, a fund backed by Lord Rothschild’s RIT Capital Partners, said the investment was not a bet on the gold price but on “the future growth of the BullionVault platform”, which stores physical gold for private clients in London, New York and Zurich. RIT currently has 9pc of its assets in physical gold.

Investment demand for the metal has risen on concerns that sovereign debt problems could spread and the value of currencies plunge. The gold price hit a new nominal all-time high above $1,260 on Friday and analysts expect the price will continue to rise.

In return for the £12.5m investment, the World Gold Council and Augmentum will receive an equity stake in BullionVault.

Marcus Grubb, managing director of investment at the World Gold Council, said taking the BullionVault stake was part of the Council’s strategy of “increasing its portfolio of successful platforms for gold investment”. Mr Levine and Mr Grubb will join BullionVault’s board.

BullionVault has about $800m (£540m) of gold under management for 20,000 customers from more than 90 countries. The average holding is around £30,000.

The World Gold Council’s previous investment vehicle, a gold exchange-traded fund, now has 1,306 tonnes of the metal under management, worth $52.3bn. This makes it the world’s second-largest exchange-traded fund. If the fund was a central bank, it would be sixth largest in the league table of gold holders.

By Garry White
Published: 11:26PM BST 20 Jun 2010

Source: The Telegraph

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