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Gold related stocks, funds attract investors

Reporter: Yang Chengxi 丨 CCTV.com

07-26-2016 16:20 BJT

Gold prices have been rising rapidly worldwide in recent weeks. That's been good news for gold-related stocks and financial products and gold companies.

Many investors have flocked to the traditionally safe haven of gold since Britain's decision to leave the European Union sent shock waves through financial markets around the world.

The rush to gold has prompted prices to rise at their fastest pace in three years. Exchange traded funds in China are also reporting a surge in demand for gold derivatives.

"Capital has been reacting very actively. Gold-related stock and funds have been performing quite well. But we should also see, that compared to the gold craze in 2013, we are not seeing a jump in physical gold purchases," said Wang Xiang, assist. fund manager, Bosera Asset Management. 

Gold has no doubt been one of the highest return assets this year, with prices rising nearly 30 percent at their recent height. Gold stocks in the Shanghai market have been benefiting from investor interest as prices for the precious metal have surged. 

"Gold prices have risen 30 percent this year. We can infer that gold companies' revenue have also risen about 20 to 30 percent. This is very positive for their short-term profit," said Sun Lei, gold analyst, Hantang Asset Management.

Many institutions are still going long on gold as the price of the precious metal continues to rise. Experts say the global economic situation has remained challenging, with major economies running into growth bottlenecks. That coincides with global central banks continuing to inject liquidity into the markets. Analysts say that combination will continue to make gold attractive to investors for some time.

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