“It will be interesting to see what happens over the next 10 years,” Boost said in a recent note. “Gold ETPs still haven’t reached their potential, especially in Asia; and China is still yet to launch a range of gold ETPs supposedly in development.”
Similarly, Graham Tuckwell, chairman of ETF Securities, believes untapped demand from China and India, and retail investors, will lead to a second decade of growth for the gold market. ETF Securities manages ETFS Physical Swiss Gold Shares (NYSEArca: SGOL). The firm has 13 different products that track the spot price of gold.
“Ten years ago, you heard about gold, people talked and got emotional about it, but you couldn’t buy it readily. It is widely acknowledged that the launch of gold ETPs has had a very significant impact on the gold market and is now a key part of it. We have witnessed a decade of growth, and despite some predicting the end of the gold bull market, I think the next decade has a lot more to go,” Tuckwell said.
“Untapped demand from China and other parts of Asia will be one of the biggest factors to drive product development and broaden access,” he added. “While the larger investors in these markets can already buy gold ETPs on other exchanges, smaller investors want to buy on their local exchange. Currently, these products are not widely available in these regions, and the demand is growing. The second change that will occur is greater investment by retail investors in the Western world.”
ETFS Physical Swiss Gold
Full disclosure: Tom Lydon’s clients own GLD.