Trump economic policy: every third German private investor fears losses in private assets
The new US administration’s economic policy is causing concern among German private investors. Almost a third of those polled expect negative implications for their assets. This is the finding of the most recent investment barometer by Deutsche Börse Commodities GmbH, which is based on a representative Emnid survey. A total of 58 per cent of Germans are concerned about their private assets – a rise of almost ten per cent since October 2016. Regarding the overall financial market situation, two thirds of respondents rate the situation as unstable, which means that the perceived insecurity has been on a constant high level since October 2016.
“Due to the global developments, a number of investors are alarmed and increasingly concerned for their private assets,” says Michael König, Managing Director of Deutsche Börse Commodities GmbH. “German private investors therefore are resorting to low-risk asset classes.” As in both previous surveys conducted in 2016, German investors state that available capital is mainly invested in real estate, money market or deposit accounts, savings accounts and gold. At the same time, Germans are increasingly investing in higher-risk asset classes in view of the continued low interest rates. 21 per cent of respondents were open to investing in stocks – that is 6 per cent more than in October 2016.
In the capital city of Berlin, the feeling of insecurity caused by news from the US is especially pronounced – more than half of its citizens expect negative economic implications caused by the Trump administration. Accordingly, their trust in gold as a safe haven is especially high: two thirds of respondents from Berlin can imagine themselves investing in the precious metal, with the nationwide willingness slightly lower at 39 per cent.
The success of Xetra-Gold shows the current high demand for gold: holdings for the security, which is backed with physical gold, have soared by more than 40 per cent since the election of the new US president. For each Xetra-Gold note, exactly one gram of gold is deposited in the central vaults for German securities in Frankfurt. A record of 160.8 tons of gold are currently held in custody for the bearer note.
About the investment barometer
The data used in this report have been collected by the market research institute Kantar Emnid (previously TNS Emnid). The sample size is 1,004. The survey was conducted between 2 and 7 February 2017. All data was collected through telephone interviews and is representative for the German population aged over 25.
Xetra-Gold (ISIN: DE000A0S9GB0) is a 100 per cent gold-backed exchange-traded commodity (ETC) issued by Deutsche Börse Commodities GmbH that represents the right to the delivery of physical gold. Each individual Xetra-Gold bearer note grants the investor the right to demand the delivery of one gram of gold from the issuer. The issuer holds a corresponding amount of physical gold and a limited amount of account gold rights for each Xetra-Gold note. The fact that Xetra-Gold takes the form of a security makes it fungible and easy to trade.
Insurance companies in Germany are also allowed to purchase Xetra-Gold for their restricted assets up to the amount of up to 5 per cent of their commodities investment. The international derivatives exchange Eurex offers futures and options on Xetra-Gold. Xetra-Gold is admitted for sale to the public in Germany, Austria, Luxembourg, the UK and the Netherlands. The full details of the Xetra-Gold ETC, especially the terms and conditions, and information on the issuer can be found in the prospectus; this, and any supplements, can be obtained free of charge from Deutsche Börse Commodities GmbH, Mergenthalerallee 61, 65760 Eschborn, Germany, or can be downloaded at www.xetra-gold.com.
About Deutsche Börse Commodities GmbH
The Xetra-Gold issuer Deutsche Börse Commodities GmbH, based in Eschborn, is a joint venture between Deutsche Börse AG and the banking partners Commerzbank AG, Deutsche Bank AG, DZ Bank AG, B. Metzler seel. Sohn & Co. KGaA, and Swiss-based bank Vontobel. Umicore AG & Co. KG, a group subsidiary of Umicore S.A. which operates several gold refineries across the globe and manufactures gold bars, is also a partner. The issuer’s sole business purpose is to provide the market with Xetra-Gold, the exchange-traded commodity (ETC) backed 100 per cent with physical gold, and to enable efficient, transparent and cost-effective trading of this securitisation of physical gold.