Asset Managers, Fiduciaries & Asset Owners
Over the years, friction has developed between the efficient mining and refining processes and the time when the institutional investor takes full ownership and control of the asset. This resistance is a source of inefficiency, inefficiency that is now avoidable. With the launch of the ABX, a substantial economic opportunity awaits all stakeholders in the precious metals industry to re-introduce this asset class into investment portfolios like never before.
Increased Security – Precious metals traded over the ABX are allocated, insured, audited, and deliverable. They are free from counterparty risk as investors own full legal title to a physical asset.
Increased Ease – The MetalDesk platform enables easy, accessible and efficient buying of precious metals, which can be used as assets, currency, or in finance.
Increased Value – ABX offers investors the ability to store in 11 locations globally and take delivery at any time, providing significantly more value and control over the investment.
Decreased Cost – ABX has modernised how the participants communicate in an electronic exchange which advanced industry standards; removing the traditional costly and inefficient barriers which have always been part of the pathway to physical bullion ownership.
Commodity Trading Advisors
Private Client Portfolio Managers
UHNW/Single Family Offices
Comparative Advantages of the ABX VS. the London-dominated process
|Problems with London market||The ABX Solution|
|OTC market||Central clearinghouse|
|Siloed London||Globally connected hubs of local physical markets|
|Unallocated Metal – Custodian holds title||Allocated Metal – Investor Holds Title|
|Logistically Inefficient & Expensive||Control of location and loco title swap & Expensive|
|Localised and manipulated pricing||Flattened & Relevant global benchmark price|
|Inaccessible for many segments||Democratisation of access|
|Costly & Time consuming to collateralise value of the assets||Speed and Transparency to monetise the value of a segregated asset|
Comparative Advantage of the ABX VS. Bullion Banks
Bullion banks are providers of both allocated and unallocated gold and paper proxies. Bullion bank technology tends to be proprietary and not integrated with many counterparties required for a transparent process. ABX enables allocated bullion, efficient access to the market, a clear audit trail, a fungible asset, institutional scale and quality, and physical ownership with minimal counterparty risks.
With the way things currently run, there are delays in purchasing gold, restrictions on vaulting locations triggering systemic risks, geographic restrictions, delays in redemption, high costs, and insufficient transparency. With open access to the market and straight through automation from suppliers to asset owners, physical precious metal becomes an asset on an owner’s balance sheet rather than a liability on someone else’s.
Benefits of Allocated Bullion Traded and Stored via the ABX VS. Holdings of ETFs/Mutual Funds:
ABX offers a safer, more cost effective, efficient, liquid, and greater value added solution over ETFs/Mutual Funds.
ABX offers direct allocated title of ownership of the metal, ETFs/Funds are unallocated meaning you get units/shares in a trust/company, but you do not get direct title of the metal.
ABX offers a true safe haven investment with no counter-party risk and financial wrapping. ETFs/Funds typically have numerous custodians with many indemnifiers representing counterparty risk and not the true safe haven gold should be.
ABX offers the ability to invest and store in 11 locations globally, ETFs/Funds typically do not provide any choice.
ABX offers the ability to take delivery at any time to any reasonable global location, ETFs/Funds typically do not offer the ability to take delivery at all.
ABX offers trade of precious metals in the true wholesale physical market, ETFs trade on a stock exchange as a shadow market.