OPM’s Tony Yousefian has increased exposure to gold within his multi-manager portfolios in the expectation that the gold price will rise a further 11% this year.
Yousefian, the chief investment officer, has taken the weighting to gold in his Balanced Managed fund to 5% to benefit from his predicted rise in the price of the physical asset from $1213 (£794) per ounce.
The manager used the slide in the price of bullion to $1,193 earlier this month to invest 2.5% of the £17m Balanced Managed fund in ETFS Physical Gold, managed by ETF Securities.
“We saw gold pull back from all-time highs and traditionally July and August have been quiet months for gold, but we do not think any pull back in the short term will be substantial, because of the current uncertainty in the macroeconomic outlook,” Yousefian says.
He expects gold to reach $1350 per ounce this year, and may take profits on the ETFS position if it approaches this level.
The fund also has indirect exposure to gold and other metals through a 2.1% holding in investment trust Altus Resource Capital, which has about 65% of its assets in gold miners, and 2.6% in the BlackRock World Mining trust.
Yousefian also took profits on a long US dollar / short sterling trade and reinvested this cash into a 2.9% position in a long renminbi / short US dollar ETF.
China’s central bank announced last month it would introduce greater flexibility to its currency, potentially ending the renminbi’s two-year peg to the US dollar.
Yousefian says: “There was massive pressure on China’s policymakers to do something about the currency.
“We do not expect there to be a massive appreciation in it, but what we are confident about is the direction of the currency, even if it is a gradual rise.”
