Important Information

  • The Fund invests predominantly in a portfolio of equity securities of companies engaged in activities related to gold and silver.
  • The Fund is subject to concentration risk and the risk of investing in gold and silver related securities. The price of gold and silver and share prices of companies engaged in related activities may be volatile.
  • The Fund is also subject to risks of investing in smaller companies and in other collective investment schemes/funds which may include closed-ended funds.
  • It may invest in financial derivative instruments for hedging, efficient portfolio management and/or investment purposes. Such investments may involve risks (e.g. counterparty, leverage and liquidity risks) that could result in significant loss.
  • Investment involves risk. Investors should read the offering document of the Fund for further details including the risk factors.

MERIAN
GOLD AND SILVER FUND

Explore the Merian Gold & Silver Fund in more detail, and discover why we believe now might be an opportune time to consider an allocation to the fund as part of a balanced portfolio. 

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  • WHY THE MERIAN GOLD & SILVER FUND?
    Highly distinctive investment approach

    The fund offers a unique investment strategy, providing actively managed exposures to gold, silver and shares in mining companies engaged in extracting the two metals in a format that is not available through an ETF. Exposures between gold, silver and mining shares are actively adapted according to the prevailing economic and market conditions.

    Potential diversification benefits from just a small allocation to the fund

    Exposure to silver and mining shares offers potential for superior returns – as these assets typically rise and fall by more than the gold price itself. The effect of the “boost” provided by these assets overs the price of gold itself in a rising market means that a relatively small allocation to the Merian Gold & Silver Fund – perhaps just a few percentage points of an overall portfolio – can potentially offer similar portfolio diversification benefits to a larger holding in, for example, an ETF that is designed simply to track the “spot” price of gold bullion on the international markets.

    Know what you own

    The fund’s exposure to gold and silver bullion is achieved through investments in listed bullion funds demonstrating the highest standards of governance and traceability, with the assets physically held in politically stable jurisdictions. Similarly, the investment team devotes significant effort to ensuring that the fund invests only in the shares of mining companies operating with the highest standards of governance and employee welfare.

  • WHY NOW?
    Prepare for the unexpected

    In times of political and economic uncertainty, gold is often heralded as the ultimate “safe haven” asset. With the outlook in 2019 for geopolitical tensions, inflation, and the associated challenges for central banks looking increasingly unclear, commentators are increasingly saying that an allocation to safe haven assets may be a prudent decision.

    Get ahead of potential future inflation

    Gain exposure to assets with the potential to perform in a more inflationary environment before a sharp rise in inflation – which is notoriously difficult to track accurately, and which often has a tendency to present itself with very little warning – presents itself.

    Follow the lead of major central banks

    Many of the world’s largest central banks allocate a significant proportion – or even the majority – of their total reserves in gold, including the US Federal Reserve (74%), Germany’s Bundesbank (69%), the Banca d’Italia (65%), the Banque de France (61%) and the Bank of England (8%).

    Potentially benefit from “de-dolarisation”

    The US dollar’s highly privileged role in the global financial system as the world’s “reserve currency” is increasingly being questioned, with some countries, including for example China, looking for alternative ways to settle international trade (for example, to purchase oil). Gold, which is often seen as the greatest “apolitical” money, since it is not issued by any central bank, is seen by many of those looking to settle international transactions as a viable alternative to the dollar.

  • OUR DIFFERENCE

    The team’s investment process is dynamic and flexible in nature. An integral part of the asset allocation process is to blend both bullion and equities in gold and silver. The manager starts with a “base case” or neutral scenario when deciding how assets are allocated. Depending on a range of technical and fundamental factors he may then wish to switch his position to either a bullish or defensive stance.

    The different allocations of bullion and equity under the manager’s differing scenarios may typically look like this:

  • FUND CHARACTERISTICS

    The fund holds between 30-50 stocks, including the listed bullion funds that make up the fund’s exposure to physical metal. The managers see this as an optimal balance between diversification of risk on the one hand and conviction in stock selection terms on the other. Most holdings on the mining equity side will be between 2% and 4% of the fund’s total value, with heavier weightings (up to 10%) in the more liquid bullion component. The fund has an expected annual portfolio turnover of around 20-50% depending on underlying market conditions. Inevitably, a more concentrated mining share component will be more volatile over short time-frames compared to the broader market.

  • RISK MANAGEMENT

    The manager considers risk from both a top-down macro market level and bottom-up company level. Prevailing foreign exchange rates in mining jurisdictions versus the US dollar selling prices for both gold and silver are another important consideration from a risk-control perspective.

    In terms of mining equities the fund aims for a quality bias in terms of company financials, project viability, management teams and growth potential. While this narrows the investable universe, the bullion weighting of the portfolio mitigates this in overall terms. The team adopts relatively high barriers to entry when considering geopolitical risk, as it sees gold and silver investing as being driven primarily by perceived safe-haven factors. The team also runs a specific balance sheet stress filter to identify potential funding issues ahead of time as the sector is relatively capital intensive.

Third-party endorsement

Don’t take our word for it. Read detailed analysis from the highly respected, independent research firm RSMR, outlining the role the Merian Gold & Silver Fund can play in a well-balanced, diversified investment portfolio.


Past performance is not indicative of future performance and may not be repeated. Investment involves risk. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested. Because of this, an investor is not certain to make a profit on an investment and may lose money. Exchange rates may cause the value of overseas investments to rise or fall.

This communication provides information relating to Merian Gold & Silver Fund (the “Fund”), which is a sub-fund of Merian Global Investors Series plc. Merian Global Investors Series plc is an investment company with variable capital established as an umbrella fund with segregated liability between sub-funds which is authorised and regulated by the Central Bank of Ireland pursuant to the European Communities
(Undertakings for Collective Investment in Transferable Securities) Regulations 2011, as amended. Registered in Ireland under registration number 271517. Registered office: 33 Sir John Rogerson’s Quay, Dublin 2, Ireland.
Hong Kong: This communication has been prepared for general information only. It does not purport to be all-inclusive or contain all of the information which a proposed investor may require in order to make a decision as to whether to invest in the Fund. Nothing in this communication constitutes a recommendation suitable or appropriate to a recipient’s individual circumstances or otherwise constitutes a personal recommendation. No investment decisions should be made without first reviewing the offering document (including the risk factors) and the key fact statement of the Fund (if applicable) which can be obtained from www.merian.com. This communication has not been reviewed by the SFC. This communication is issued by Merian Global Investors (Asia Pacific) Limited. Merian Global Investors (Asia Pacific) Limited is licensed to carry out Type 1 and Type 4 regulated activities in Hong Kong. The Fund is authorised by the Securities and Futures Commission (“SFC”) in Hong Kong. Such authorisation is not a recommendation or endorsement of the Fund nor does it guarantee the commercial merits of the Fund or its performance. It does not mean that the Fund  is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors.

The Fund may be more than 35% invested in Government and public securities. These can be issued by other countries and Governments.

Your attention is drawn to the stated investment policy which is set out in the Fund’s prospectus. The net asset value of the Fund may have high volatility due to the nature of the asset class invested. Your attention is drawn to the stated investment policy which is set out in the Fund’s prospectus.

 

 

Ned Naylor-Leyland joined Merian Global Investors in 2015 and is the fund’s lead portfolio manager. He has over 15 years’ investment industry experience, having worked at Smith & Williamson, before founding a dedicated gold and silver fund for Cheviot Asset Management. Ned is supported by Joe Lunn and Chris Mahoney. Joe is a mining engineer who worked in the industry in South Africa and Australia before returning to London to work as a mining analyst. Joe is the team’s dedicated mining equity research analyst as well as a portfolio manager. Chris, in his role as portfolio manager, performs both investment and equity research functions.

VIEWS FROM NED NAYLOR-LEYLAND
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