Monday, 30 November 2020
Many Australians are using the vehicle of a Self-Managed Superannuation Fund (SMSF) in order to diversify their superannuation into other asset classes that may not be available in retail and industry superfund offerings. The number of SMSF members in Australia has swelled to over 1.1 Million in 2020, with total assets under management growing to a whopping $705 Billion AUD.
The popularity of SMSF’s has only increased during the Covid19 pandemic as investors are seeking alternatives that do not correlate with equity markets and provide a hedge to the other holdings in their superannuation portfolio. On average, SMSF investors will allocate a smaller percentage of their portfolio into listed shares when compared to the standard industry and retail ‘balanced’ options.
The ‘balanced’ option in retail and industry superfunds usually holds more than 50% of the portfolio in domestic and international shares. With the level of uncertainty around Covid19 and the economic consequences that will follow, many Australians right now are looking for a way to diversify their superannuation portfolio.
Precious metals exposure can add balance to one’s portfolio due to the very low correlation with equities. What this means is that when stock markets tend to have a very bad year, gold and silver tend to outperform and post a strong return. Being a safe haven asset, gold often sees rapid inflows of capital during times of panic and uncertainty, which can lead to the price outperforming in years where other asset classes suffer. For example, in 2020 we saw a dramatic fall in equities occurring in February/March which has lead to the Australian share market trading circa -3.6% year-to-date whereas gold has delivered a return of over +18% in that same timeframe.
When it comes to owning gold in your superannuation, if you are looking for allocated physical metals that you can hold and store yourself, then the only option would be to firstly establish an SMSF. The trouble is, an SMSF is not for everybody and it is best to seek advice to work out whether or not an SMSF is right for you.
If you do find that the SMSF option is cost-effective and suits you, then the process of buying and storing physical precious metals through Guardian Vaults is easy and straight forward and is summarised below:
- Establish an SMSF
- Wait for funds to roll over from your previous Super account.
- Register a trading account under the SMSF with Guardian Gold.
- Lock in a price to buy gold or silver over the phone or online.
- Make payment out of your SMSF bank account.
- Arrange appropriate storage and insurance through Guardian Vaults.
At Guardian Vaults we cater to all SMSF clients needs by having a seamless process that allows one to order the physical bullion, take delivery from within a secure vault, and easily arrange for insurance and end of financial year audit requirements to ensure your SMSF is compliant.
We also have the largest range of safe deposit boxes available in Australia with capacity going from a small box that holds 20 kilograms, right up to our Grand Bullion Safes which hold over 1,000+ kilograms.
To find out more feel free to call through and speak to one of our representatives or email your questions to email@example.com
Disclaimer: Guardian Vaults Holdings Pty Ltd, Registered Office, Scottish House, 100 William Street, Melbourne, Victoria, 3000. ACN 138618176 (“Guardian Vaults”) All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from the publisher and/or the author. Information contained herein is believed to be reliable, but its accuracy cannot be guaranteed. It is not designed to meet your personal situation. Guardian Vaults, its officers, agents, representatives and employees do not hold an Australian Financial Services License (AFSL), are not an authorised representative of an AFSL and otherwise are not qualified to provide you with advice of any kind in relation to financial products. If you require advice about a financial product, you should contact a properly licensed or authorised financial advisor. The information is indicative and general in nature only and is prepared for information purposes only and does not purport to contain all matters relevant to any particular investment. Subject to any terms implied by law and which cannot be excluded, Guardian Vaults, shall not be liable for any errors, omissions, defects or misrepresentations (including by reasons of negligence, negligent misstatement or otherwise) or for any loss or damage (direct or indirect) suffered by persons who use or rely on such information. The opinions expressed herein are those of the publisher and/or the author and may not be representative of the opinions of Guardian Vaults, its officers, agents, representatives and employees. Such information does not take into account the particular circumstances, investment objectives and needs for investment of any person, or purport to be comprehensive or constitute investment or financial product advice and should not be relied upon as such. Past performance is not indicative of future results. Due to various factors, including changing market conditions and/or laws the content may no longer be reflective of current opinions or positions. You should seek professional advice before you decide to invest or consider any action based on the information provided. If you do not agree with any of the above disclaimers, you should immediately cease viewing or making use of any of the information provided.