Friday 18 Oct
Dr. Moustafa Madbouly, Prime Minister confirmed on Tuesday that the establishment of gold investment funds, a key component of the state's efforts to develop a robust non-banking financial sector, is a significant milestone in promoting financial and investment inclusion in Egypt.
Madbouly emphasized that these funds are designed to offer a secure investment environment and a variety of savings options to cater to the diverse needs of different segments of society. They enable investors to purchase certificates that can be used to invest in gold through banks and licensed companies.
Madbouly's remarks came during a
review of a report on the performance of gold investment funds during July and
August, presented by Dr. Mohamed Farid Saleh, Chairman of the Financial
Regulatory Authority. The report provided an update on the latest developments
in the activities of gold investment funds within the broader context of
precious metals investment funds for the months of July and August 2024.
In his report, the Chairman of
the Financial Regulatory Authority announced the launch of a third gold
investment fund in June 2024. Operated by the National Bank of Egypt's
Investment Management Company and Evolve Investment, the "Dahab" fund
aims to invest directly in physical gold bullion. The fund seeks to track the
price or gold index published by the Egyptian Exchange (EGX), with a
correlation coefficient of no less than 80%.
The Chairman stated that
contracts for acquiring fund certificates are executed through various
companies specializing in securities trading. He highlighted that the
subscription period for the fund's certificates concluded on July 4, 2024, with
a total subscription exceeding 30 million Egyptian pounds, surpassing the
target of 10 million pounds.
Dr. Mohamed Farid further elaborated in his report that the total net assets of gold funds have experienced an upward trend, aligning with the gold price as declared by the Egyptian Exchange. Consequently, the market share of each fund has witnessed a shift at the close of August 2024 when compared to its total net assets in July 2024. This notable trend encompasses the AZ-Gold fund, the Beltone Evolve Gold Investment Fund "Bullion," and the National Bank of Egypt Investment Fund "Dahab."
It is noteworthy that the pioneering gold fund, "AZ-Gold," was established in May 2023. This launch coincided with the introduction of novel regulations specifically designed for these funds, a relatively recent addition to the Egyptian economic landscape. These regulations aim to facilitate direct investments in gold metal. Following closely, the Beltone Evolve Gold Investment Fund "Bullion" was introduced in January 2024.
