Buying & Holding
Ravenscroft offers allocated bullion, in the exact form, weight and purity requested, that can be sold or withdrawn, in whole or in part, at any time. This differs from some of the other investments available, as we will explain below. There may also be financial reasons to switch if you hold exchange-traded or fractional ownership precious metals, as some physical assets are tax-exempt for UK investors using Ravenscroft, both from value-added and capital-gains tax perspectives.
Regular, physically backed, ETCs are designed to be simple and transparent open-ended securities that trade on well-regulated exchanges. ETCs allow the buyer to gain exposure to precious metals, without having to trade in futures contracts or take physical delivery.
Some ETCs use derivatives, most typically swaps, to replicate the price movement of precious metals, which may be technically proficient, provided that is what the buyer wants and understands.
We calculate that the overall costs of ETC purchase, ownership and sale will be more expensive than those incurred in physical bullion after an 18 month holding period. Contact us and we will run you through the maths.
Fractional ownership schemes offer exposure to precious metals held on a collective basis for the clients of the scheme. Investors should ensure the scheme is backed, in full, by physical bullion of an appropriate standard, and that the assets are independently audited. Investors should be aware that, should they wish to withdraw physical bullion from the scheme, costs can prove nothing short of exorbitant.
Some pension rules might not permit investment in such 'shared bar' offerings, owing to trustee clauses requiring clear definition of asset ownership.
Having said all of the above, Ravenscroft has chosen to offer unallocated ounces as a way of providing short-term, low-cost exposure to the prices of precious metals. Your dealings in unallocated metals carry an ultimate counterparty risk of HSBC in London. You may use any such holding to 'upgrade' to physical bullion later, with the premium already paid for unallocated set against your choice of bar or coin.