Beltone, Evolve Holding launch new gold investment fund

Ahram Online , Sunday 14 Jan 2024

Beltone Financial Holding’s subsidiary Beltone Asset Management has announced the launch of a new gold investment fund in collaboration with investment company Evolve Holding, read a statement on the Egyptian Exchange (EGX).

Michael Probst / the Associated Press file photo.
Michael Probst / the Associated Press file photo.


The fund, called Sabayek (which means bullions), will focus on investing in 24-carat gold bars and will issue 100,000 investment certificates, each valued at EGP 100.

Sabayek aims to provide Egyptian investors with an alternative way to invest in gold, which can serve as a hedge against inflation and currency fluctuations while also offering portfolio diversification.

Moreover, Sabayek represents the second gold investment fund introduced by Evolve Holding, following the first fund, which invests in 24-carat gold bars and issues investment certificates starting from EGP 10.

“The fund serves as a milestone in Egypt's financial landscape, offering investors access to the stability and long-term value of gold as an investment asset,” said Khalil El-Bawab, CEO for Local and Regional Markets at Beltone.

The global and local geopolitical tensions, coupled with expectations of interest rate cuts by the US Federal Reserve in 2024 and global shortage in US dollar reserves, have prompted investors to increase purchases of gold as a means to hedge against rising prices and global inflation.

As a result, gold prices reached an all-time high of $2,078 per ounce in 2023, representing a 15 percent year-on-year increase.

Local gold market

In Egypt, prices have risen significantly since the outbreak of the Israeli war on Gaza in October 2023, as investors have sought to hedge against uncertainties by purchasing safe assets such as gold.

However, prices have recently started to decline following the issuance of high-yield certificates of deposit (CDs) by the National Bank of Egypt (NBE) and Banque Misr.

Nagi Farag, an advisor to the minister of supply for gold affairs, expected last week these new CDs to contribute to a decline in the price of 21-carat gold from the current EGP 3,742 per gram to EGP 2,500 per gram.

Sunday’s local prices of 24-carat and 21-carat gold in Egypt stand at EGP 3,742 and EGP 3,274 per gram, respectively, reflecting an increase of more than EGP 90 since the previous session, according to Egypt Gold Price Today.

Moreover, the amount of gold remaining in Egyptian mines amounts to at least 25 million ounces (or over 781 tons), said Farag.

The NBE and Banque Misr introduced CDs in early January with annual yields of 23.5 percent and 27 percent, respectively, and are expected to collect over EGP 500 billion by the end of the anticipated issuance period in February.

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