Bullion Management Group Inc….has expanded its line of bullion funds with the launch of BMG Silver BullionFund…[which] invests exclusively in physical silver bullion. It is designed for investors seeking to add silver to their precious metals investments that offer long-term security and potential capital growth. [For details on this unique investment product please read their press release below.]
Nick Barisheff, President and CEO of BMG, believes there are several important reasons why investors looking for a safe haven are adding [silver] bullion to their portfolios:
- [With] $13.4 trillion of government bonds worldwide now offering yields below zero… advisors and investors are compelled to seek alternative safe-haven investments, and are increasingly turning to silver.
- With global stock and bond markets currently in excess of $300 trillion, there is the potential for a major increase in [the silver] price, given that estimated above-ground silver is only $40.2 billion.
- In addition, mine production has been falling, while demand has been increasing…In 1996, total global silver bar and coin investment was only 23 million ounces [but has]…surged to 236 million ounces [in the last 20 years]…
- At the current price of $17.50 per ounce, silver is significantly undervalued based on the current gold:silver ratio of 72:1. The average ratio in the 20th century was 47:1, which would indicate a current price of $26.60.
- Silver exists in the earth’s crust at a 17.5:1 ratio, and is currently being mined at a 9:1 ratio to gold. These supply/demand discrepancies point to long-term continuation of silver bullion’s price appreciation…
- Silver bullion’s year-to-date rise of 26.2% surpasses even gold’s stellar performance of 17.8% – and silver far outshines the respective S&P 500 and TSX composite returns of 4.7% and 12.4%.
- Silver has demonstrated it typically outperforms gold’s price appreciation in times of market stress, such as the 2008 financial crisis…[when,] from the start of 2008 to the end of 2010, the silver price rose 97.0%, while the gold price rose “only” 65.6% (and the S&P 500 declined 14.3% and TSX declined 3.3%). As with all precious metals, silver’s negative correlation to falling stock and bond prices is well documented.
- According to Barisheff, the new BMG Silver BullionFund meets a specific need in the marketplace for a bullion-only silver fund without the liquidity constraints of a closed-end fund, or the counterparty risks of an ETF. The fund offers the same liquidity as bullion itself, and is always priced at NAV.
BMG Silver BullionFund is built on the same model as BMG BullionFund, which invests only in gold, silver and platinum bullion, and BMG Gold BullionFund, which invests exclusively in gold bullion.
Like BMG BullionFund and BMG Gold BullionFund, BMG Silver BullionFund:
- is an open-end mutual fund trust that can be purchased and redeemed daily at Net Asset Value (NAV);
- is eligible for [of interest to Canadian investors] TFSA, RRSP and RESP investments;
- offers investors the security of allocated, insured bullion without compromising any of the fundamental attributes of physical precious metals ownership:
- immediate liquidity;
- no reliance on management skills;
- no counterparty risk, and
- no use of derivatives, futures, options, leasing, currency hedging or gold certificates.
- is designed to provide a low-cost, medium-risk alternative for investors seeking to purchase and hold precious metals bullion without the worry, trouble and cost associated with trading and storage.
- is managed through its subsidiary, Bullion Management Services Inc. and
- its bullion holdings, under a custodial agreement with The Bank of Nova Scotia in Toronto, are:
- held in trust and, in addition
- meet London Good Delivery Standards, and
About Bullion Management Group Inc.
Founded in 2002, BMG…is based in Toronto, Ontario, Canada, with offices in multiple countries, including Panama and the United Kingdom…was the first precious metals bullion management company in Canada to become an Associate Member of the LBMA, an honour it shares with the Royal Canadian Mint, the Crown Corporation that produces Canada’s currency. This validation and endorsement is only bestowed upon firms that meet the LBMA’s rigorous industry standards on refining, reliable trading and Good Delivery practices. BMG is also an associate member of the Responsible Investment Association (RIA) and a signatory to the Principles for Responsible Investment (PRI). For more detailed information, visit www.bmgfunds.com or www.bmgbullion.com.
The above comments are excerpts from the original press release from BMG which have been enhanced – edited ([ ]) and abridged (…) – by munKNEE.com (Your Key to Making Money!) to provide you with a faster & easier read. Join a very select group of knowledge seekers who regularly “follow the munKNEE” by registering in the top right hand corner of this page to receive your free bi-weekly Market Intelligence Report newsletter (see sample here.)