Investors in Asia are increasingly using gold as a core asset in their long-term portfolios. Nonetheless, almost a quarter have no exposure to the precious metal, according to a survey by State Street Global Advisors and the World Gold Council.
Nearly one quarter (24 percent) of asset owners in Asia Pacific do not own any gold investments, according to the «Gold Perceptions Survey» by State Street Global Advisors and the World Gold Council.
Commonly cited barriers were that gold does not pay coupons or dividends (59 percent), difficulty in calculating intrinsic value due to a lack of an established model (37 percent) and reduced appeal from changes in the strength of the US dollar (25 percent).
Proven Diversifier
Still, the vast majority of respondents in the survey held gold with 22 percent holding an allocation of 0.1-0.9 percent, 46 percent holding 1-4.9 percent and 8 percent holding 5 percent or more. 27 percent are also anticipating increasing investments in the precious metal.
The top benefits cited include proven diversification, especially in periods of financial turmoil and economic uncertainty (59 percent), increased risk-adjusted returns (37 percent) and hedging against a weakening US dollar (37 percent).
The survey was based on interviews with 850 consultants, financial advisors, retail customers and institutions globally, including 63 asset owners in APAC. Chief investment officers and directors of investments made accounted for 32 percent and 68 percent, respectively, each with over $1 billion in investable assets.
