At the conclusion of 2024, the gold assets of Xetra-Gold, a notable exchange-traded bearer bond, saw a significant reduction, resulting in total holdings of 166.5 tons. This marks a decrease of approximately 32 tons from the previous year’s figure of 198.7 tons. Despite this decline in holdings, the value of gold has been on an upward trend, achieving a price of €80.61 per gram by the end of the year. Consequently, the total assets managed by Xetra-Gold climbed around 13% compared to 2023, reaching €13.5 billion.
Market analysis indicates a shifting sentiment towards gold investments within exchange-traded funds (ETFs) and physically-backed exchange-traded commodities (ETCs), which are increasingly seen as viable alternatives to traditional gold bars and coins. Nevertheless, European ETCs, particularly those backed by physical gold, have experienced outflows this past year. The rising price of gold has contributed to this selling trend over recent months. However, experts argue that maintaining a portfolio hedge of about five to ten percent in gold is beneficial for the long-term and should not be hastily sold.
Xetra-Gold stands as the fifth-largest gold ETC globally and leads as Europe’s largest gold security that is physically backed. The gold holdings associated with Xetra-Gold increase each time shares are purchased on the stock exchange, with one gram of gold held in reserve for each share certificate issued. Investors also have the option of having the actual gold delivered. Since its inception in 2007, nearly 2,000 gold deliveries have taken place, totaling about eight tons, with 53 deliveries in 2024 alone amounting to 223 kilograms.
From a regulatory perspective, a 2015 ruling by the German Federal Fiscal Court established that profits from Xetra-Gold sales would not incur withholding tax after a minimum holding duration of one year. This determination means such sales are treated similarly to the sale of physical gold for tax purposes.
Xetra-Gold is developed and managed by a partnership between Deutsche Börse Group and several banking entities, including Commerzbank, Deutsche Bank, DZ Bank, B. Metzler seel. Sohn & Co., and Swiss bank Vontobel. Additionally, the gold producer Umicore plays a role in this collaboration.
Overall, the performance and strategic perspective surrounding Xetra-Gold suggest a nuanced landscape for gold investments, combining both traditional market approaches and modern financial instruments, as investors navigate the varying conditions of the global economy.