Download Xetra-Gold Precious. Always. And forever.

Xetra-Gold
Precious. Always.
And forever.
An investor’s guide
3
Why Xetra-Gold
Investors have wide investment possibilities when
it comes to participating in the development of the
gold price. They can invest directly in physical gold.
However, due to the gold market’s lack of efficiency
and transparency, investing in physical gold involves
a large spread and considerable overhead costs,
for instance the costs of custody and logistics or
delivery charges. Alternatively, investors can invest
indirectly by purchasing financial products structured
by reference to gold, such as gold funds, shares
in gold mining companies, or structured products.
These investments allow the investor to buy and sell
exposures to gold for relatively low overhead costs
and with relatively high flexibility, but the financial
products themselves are not backed by physical gold.
Xetra-Gold ® brings together these two forms of
investment. It combines the simple, efficient and
low-cost trading of a financial product with a right
to the delivery of physical gold.
Xetra-Gold is a no par value note denominated in
gold, priced and settled in euros and issued by
Deutsche Börse Commodities GmbH. Xetra-Gold is
an exchange-traded security in the form of a bearer
note. Each bearer note grants the investor the right
to demand the delivery of one gram of gold from
the issuer. The fact that Xetra-Gold is an exchangetraded security makes it fungible and as easy to
transfer as a share.
The electronic Xetra ® trading platform allows for liquid
trading of Xetra-Gold with tight bid/ask prices – the
spread on average is below 0.1 percent. Order book
turnover in the first half of 2010 amounted to a daily
average of some @10 million, making Xetra-Gold by
far the highest-volume security of all exchange-traded
commodities that can be traded on Xetra.
Xetra-Gold is quoted in euros. Institutional investors
holding Xetra-Gold within an investment portfolio in
euros thus have no currency risk when purchasing
Xetra-Gold.
All Xetra-Gold trades are cleared by Eurex Clearing,
Deutsche Börse Group’s clearing house. Eurex Clearing serves as central counterparty (CCP) to all parties
involved in the trade thus mitigating counterparty risk.
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5
Adding gold to your portfolio
A well diversified portfolio protects against unpleasant
surprises. Commodities are a good way to improve risk
diversification and protect a portfolio against inflation
and currency turbulence. That holds for gold, too.
Gold can enhance a professionally managed portfolio.
Even small positions in gold can significantly help to
steady a portfolio’s performance in both stable and
turbulent market phases.
Xetra-Gold standard
Gold has proven its worth over centuries: as a
commodity, a global currency, an investment or
simply an object of beauty. In recent years, gold has
become increasingly interesting for investors. Over
the past 40 years, the gold spot price has increased
more than twentyfold.
Entwicklung desofGoldpreises
Dezember
– 31. Januar 2014
Development
gold spot31.
price
1970 1970
– 2014
US-Dollar
2000
1800
1600
1400
1200
1000
800
600
400
200
0
1970
1974
1978
1982
1986
1990
Gold is not called a precious metal for nothing.
The supply of gold is physically limited.
The demand for gold, especially in Asia, has been
rising continuously and has been exceeding the
supply for years.
Gold is chemically almost indestructible: the vast
majority of the gold ever mined is still in existence.
Hedge against financial turbulence
The gold price is, for the most part, independent of
capital market developments and shows a low correlation with the performance of stock indices such as
the S&P 500 Index and other major asset classes.1)
This proves to be a major advantage for a portfolio:
while traditional and alternative investment products
can often fail in times of crisis, gold has historically
performed well relative to equities and other stock
market assets during periods of economic or financial
turbulence and during periods of significant monetary
easing and above-average inflation.
1) GFMS Gold Survey 2010, page 17
1994
1998
2002
2006
2010
2014
Hedge against inflation
While currencies can lose purchasing power through
inflation, gold has proven to be of more stable value
in the long term. Although the price of gold can be
depressed, no government in history has managed
to completely devalue gold as a store of value or
means of exchange. Gold has remained sound over
decades: it took about five kilograms of gold to buy a
luxury class limousine 40 years ago – just the same
as it does today even though the price of the limousine has increased many times over. Gold offers a
way of protecting a portfolio against inflation and
fluctuations in the key trading currencies, the euro
and the US dollar.
Xetra-Gold ® with ISIN DE000A0S9GB0 gives investors an attractive opportunity to participate in the
performance of the gold market. Xetra-Gold’s combination of features makes it an attractive product.
Low-cost
No front-end load, no management fees as for
other securities backed with physical gold. No
transportation or insurance costs which are incurred
when purchasing physical gold. Xetra-Gold is a
cost-efficient way to invest in gold. The only fees
you pay when buying or selling are the standard
transaction fees for on-exchange securities trading.
Constant holdings
No management fees are taken off the net asset
value of your gold investment. Unlike other investments in gold, the investor’s right to receive delivery
of the securitized amount of gold is not reduced.
For example: a management fee of 39 bps will
reduce your gold holdings by 7.5 percent over 20
years, while 1,000 Xetra-Gold securities will still
be a kilogram of gold in 20 years’ time. Xetra-Gold,
like any other asset under custody, is only subject
to custody fees that are reported separately.
Low spreads
The spreads that apply to purchase and sale are considerably lower than those for traditional gold-based
financial products. Multiple market makers provide
liquidity and ensure the prices are made around the
net asset value. The maximum spread is 1 percent –
since its launch, however, Xetra-Gold has been traded with 0.1 percent spread on average.
Fungible
Xetra-Gold is traded on Xetra ®, Europe’s most efficient trading platform, along with 400,000 other
securities. This means liquid, continuous trading
on the regulated market with high transparency,
from 9 a.m. until 5.30 p.m. CET each trading day.
as central counterparty (CCP) to all parties involved in
the trade. The risk of a counterparty not meeting their
obligation is thus removed for the investor.
Tradable in gram
While gold is usually traded in US dollars per troy
ounce, the unit of trade of Xetra-Gold is grams
and kilos. The conversion between grams and
troy ounces is: 1,000 grams = 32.1507465 troy
ounces and 1 troy ounce = 31.1034768 grams.
Quotation in euro
Due to its quotation in euros, institutional investors
have no currency risk within an investment portfolio
in euros when adding Xetra-Gold to this portfolio.
Physically backed
The issuer, Deutsche Börse Commodities GmbH,
uses the proceeds from the issue of Xetra-Gold
to purchase physical gold and to a limited extent
account gold. The physical gold is held in custody
for the issuer in Germany, in the vaults of Clearstream Banking AG, a wholly-owned subsidiary of
Deutsche Börse AG. In order to facilitate the delivery
of physical gold, the issuer further holds a limited
amount of gold on an unallocated weight account
with Umicore AG & Co. KG. Physical delivery is
not restricted or limited in quantity.
Repayment in gold
Investors can exercise their right to delivery of the
securitized amount of gold against the issuer at
any time. If this is not possible due to prevailing
legal restrictions, they can demand that the issuer
redeem Xetra-Gold in the form of a cash payment
instead of gold.
Transparent
Xetra-Gold tracks the price of gold on a virtually 1:1 basis, and is always up to date.
Reliable issuer
Deutsche Börse Commodities is an issuer remote from bankruptcy. Investors can rely on the
lowest possible credit risk. This is due to the joint
venture structure of the company with strong
partners (see following page) and its lean organization with Xetra-Gold being its one and only
business activity.
CCP clearing
All Xetra-Gold trades are cleared by Deutsche Börse
Group’s clearing house Eurex Clearing which serves
Vendor codes
WKN A0S9GB | ISIN DE000A0S9GB0
Xetra ticker symbol 4GLD
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Established and regulated process chain
from trading via safe custody to delivery
Xetra-Gold ® is traded on Deutsche Börse AG’s
fully electronic Xetra® trading platform. Deutsche
Bank AG acts as designated sponsor. A designated
sponsor guarantees a liquid, continuous market in
the security. It maintains firm bid and offer prices
throughout exchange trading hours and assures a
permanent quotation under normal trading conditions. The quotation is oriented to the current gold
price in US dollars and the exchange rate between
the US dollar and the euro.
Renowned partners, proven quality
If an investor exercises the right to the delivery of
the securitized amount of gold against the issuer, the
gold is delivered to the designated place of delivery
by Umicore AG & Co. KG, which is responsible for
all physical delivery processes. Additionally, the
issuer has rights of claim to the delivery of gold
against Umicore AG & Co. KG as the account gold
obligor. The costs of delivery are listed below.
Deutsche Börse AG and its subsidiaries organize
trading, clearing and settlement of the transactions
according to strict regulations. Eurex Clearing has
been accorded the status of Recognised Overseas
Clearing House (ROCH) by the United Kingdom
Financial Services Authority (FSA). Clearstream
Banking AG, Frankfurt, stores the gold in its vaults
in line with the highest security standards.
Switzerland, Austria,
Luxembourg, Netherlands
Number of bullions
Germany
1 x 1 kg
€ @ 315
@ 2,950
@ 5,775
10 x 100 gr
€@ 605
@ 3,250
@ 6,040
10 x 1 kg
@ 980
@ 3,475
@ 6,300
100 kg
100 x 1 kg
@ 7,350
@ 8,140
@ 11,025
8 x 12.5 kg
@ 1,375
@ 3,425
@ 5,880
500 kg
40 x 12.5 kg
@ 5,250
@ 7,245
@ 7,560
1,000 kg
80 x 12.5 kg
@ 10,500
@ 13,875
@ 17,430
1 kg
Umicore AG & Co. KG, a Group subsidiary of Umicore
S.A., is the industrial partner for all physical gold
transactions. Umicore is a refiner approved by the
London Bullion Market Association (LBMA). The gold
bullion in our vaults is held in the form of London
‘Good Delivery’ bars with a set number of ounces,
specified weight and dimensions and a required fineness (purity) of at least 99.5 percent. The bars are
thus acceptable for delivery on the London market.
Derivatives on Xetra-Gold tradable at Eurex
Estimated costs for delivery of physical gold (May 2014)
Quantity for delivery
Investors who opt for Xetra-Gold ® can rely on a
professional process chain. The issuer, Deutsche
Börse Commodities GmbH, based in Frankfurt, is a
joint venture between Deutsche Börse AG and the
banking partners Commerzbank Aktiengesellschaft,
Deutsche Bank AG, DZ BANK AG, B. Metzler seel.
Sohn & Co. KGaA, along with Bank Vontobel AG,
based in Switzerland.
United Kingdom
As Xetra-Gold ® has proven to be a highly liquid and
widely traded instrument among European investors,
the international derivatives exchange Eurex has
added Xetra-Gold to its portfolio of precious metals
derivatives. The futures and options on Xetra-Gold
are denominated in euro and are physically settled
with the delivery of the underlying exchange-traded
commodity (ETC), Xetra-Gold. Expiration dates of the
derivatives are on the third Friday of March, June,
September and December.
By offering Xetra-Gold products on both the spot and
the derivatives markets, Deutsche Börse gives its
customers access to the gold market and provides
them with the flexibility to suit their specific financial needs. Furthermore, Eurex Clearing, Europe’s
leading clearing house, will accept Xetra-Gold as
collateral from October 2010.
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Opportunities
Portfolio
stabilization
Xetra-Gold ® largely reflects the value of the
commodity gold, which develops more or less
independently of other securities. Adding XetraGold to the portfolio can help to diversify risk
and stabilize performance.
Product features of Xetra-Gold
Securitization
Each Xetra-Gold note grants the investor the right to
the delivery of one gram of gold from the issuer or,
alternatively, if an investor is not permitted to take
delivery of gold for legal reasons, to demand repayment of Xetra-Gold in cash at its repayment value.
Participating in the performance of the gold price
Given continued strong commodity demand and
constant production capacity Xetra-Gold offers
attractive potential returns.
Issuer
Deutsche Börse Commodities GmbH
Type
of security
Bearer note
WKN
code / ISIN code
A0S9GB / DE000A0S9GB0
Securitization
Global certificate
Currency
EUR
Risks
Market risk
For economic purposes, investors buying XetraGold ® are invested in gold and are exposed to
the market risk relating to gold. If the gold price
falls, the investor can lose part or all of the capital
invested. As there are other price-relevant factors
besides the gold price (such as the credit quality
of the issuer), the value of Xetra-Gold may deviate
from the gold price.
No beneficial ownership to gold
Investors investing in Xetra-Gold acquire the rights
securitized in the notes. Investors do not acquire
ownership/beneficial ownership or a lien to the gold
held in custody in physical form on the issuer’s
behalf or to the issuer’s account gold claims.
Risk of loss
The gold held in custody in physical form by
Clearstream Banking AG on the issuer’s behalf is
exposed to a risk of loss. Should such risk of loss
for the issuer materialize, this would probably impair the issuer’s ability to meet its obligations on
the notes as there are no other assets available.
Quotation
Unit quotation, nominal value one gram of gold
Tradeability
There is no guarantee that a secondary market in
Xetra-Gold will evolve. This harbours the risk that
investors may not be able to sell Xetra-Gold in the
market, or not at all times.
Early redemption
In case of early repayment, to which the issuer is
entitled in certain circumstances, there is the risk
for investors that the early redemption amount
paid may be lower than the value of Xetra-Gold
before the notes were called by the issuer.
The risk factors listed above are not exhaustive and
do not provide a comprehensive overview of all the
risks associated with an investment in Xetra-Gold.
Before investing in Xetra-Gold, investors should read
the prospectus and take independent advice.
Term
unlimited
Listing
Admission to the Regulated Market (General Standard) on the Frankfurter Wertpapierbörse (FWB ®,
the Frankfurt Stock Exchange)
Date
of issue
29 November 2007
Issue
volume
Up to ten billion bearer notes
Issue
price
To be determined continuously
Fees
& charges
The usual transaction costs are charged when
trading securities on the stock exchange plus the
respective custody fees. In the relationship between Clearstream Banking AG and the respective
custodian custody fees are charged per calendar
month which until further notice amount to 0.025
percent of the monthly holding of Xetra- Gold ®. If
the custodian is the custodian bank of the investor
investing in Xetra-Gold, it is likely that the custodian
bank will charge this custody fee (plus any valueadded tax) to the investor. If an investor exercises
the right to the delivery of the securitized amount of
gold against the issuer, the investor will be charged
the cost of the forming, packaging and insured delivery of the gold to the designated place of delivery
plus any applicable value-added tax. Investors who
demand repayment of Xetra-Gold at the repayment
value in euro will receive as repayment amount a
sum equivalent to the relevant gold market price
less a handling charge of @ 0.02 per bearer note.
Issuer’s
call option
If less than ten million bearer notes are in circulation as of 31 December of any year, the issuer
may call the bearer notes by 31 January of the
following year (the “following year”) and redeem
them in their entirety at the early repayment
amount on 29 May of the following year.
Fiscal
agent
Deutsche Bank AG
Principal
paying agent
Deutsche Bank AG
Custodian
Clearstream Banking AG
Vault
location
Germany
Redemption
agent
Deutsche Bank AG
Place
of delivery
A bank’s place of business in or outside the
Federal Republic of Germany specified by the
investor that is willing to take delivery of the gold
upon the investor’s demand for delivery.
Secondary
market
Deutsche Bank AG acts as designated sponsor
and will maintain continuous bid and offer prices
in the electronic Xetra ® trading system under
normal trading conditions.
Latest
price information and gold bar list
www.xetra-gold.com
10
Disclaimer
© Deutsche Börse Commodities GmbH. As at: May 2014
The following document is intended purely as marketing material.
The information contained in this document does not constitute investment advice
but instead merely provides a summarised description of the securities’ key features. The full details of the securitiy, including risk factors may be noted from the
prospectus. The prospectus constitutes the only binding basis for the purchase of
the securities.
Investors can obtain these documents and copies of the articles of association, annual and semi-annual reports in German or – if available in English language in electronic or printed form free of charge from Deutsche Börse Commodities GmbH, 60485
Frankfurt am Main, or downloaded them from the homepage www.xetra-gold.com.
The information contained in this document is intended purely as marketing material
and does not constitute a financial analysis. For this reason, this document does
not need to meet all legal requirements designed to guarantee the independence of
financial analyses and it is not subject to any prohibition on dealing ahead of the
publication of financial analyses.
As explained in the relevant Prospectus, distribution of the aforementioned securities
is subject to restrictions in certain jurisdictions. For this reason, the securities mentioned herein may neither be offered nor sold in the USA, nor to, or for the account
of, US persons or persons residing in the USA.
This document and the information contained herein may only be distributed and
published in jurisdictions in which such distribution and publication is permissible in
accordance with applicable law in those jurisdictions. Direct or indirect distribution
of this document is prohibited in the United States, Canada and Japan as well as to
US persons and persons residing in the USA.
The offering prospectus contains more detailed tax information.
All prices are provided for informational purposes only and do not serve as an indication of trading prices.
The returns shown do not include transaction costs, commissions and taxes which
can have adverse effects on the returns. Transaction costs and sales-related commissions can be incurred for the subscription and for the purchase or sale of the
securities on the secondary market.
Past performance cannot be regarded as a reliable indicator of future performance.
All statements of opinion expressed reflect Deutsche Börse Commodities GmbH’s
current assessment and can change without prior notice.
Xetra Gold® is a registered trademark of Deutsche Börse AG.
Deutsche Börse Commodities GmbH is a joint enterprise of Deutsche Börse AG and
its partners Commerzbank AG, Deutsche Bank AG, DZ Bank AG, B. Metzler seel.
Sohn & Co. KGaA and the Swiss Bank Vontobel.
The registered office of Deutsche Börse Commodities GmbH is located at Mergenthalerallee 61, 65760 Eschborn, Germany.
Additional information for investors in Switzerland
The securities must not be offered, advertised or otherwise distributed (directly or
indirectly) in or from Switzerland, nor may this document or other distribution or
offering material in relation to the securities be distributed or otherwise be made
accessible in or from Switzerland, except to qualified investors within the meaning of
Art. 10 of the Swiss Act on Collective Investment Schemes (Kollektivanlagengesetz;
"KAG"). The securities do not qualify as a collective investment scheme (kollektive
Kapitalanlage) within the meaning of the KAG nor are they subject to the authorisation or supervision of the Swiss Financial Markets Supervisory Authority (Eidgenössische Finanzmarktaufsicht FINMA.
Reproduction – in total or in part – only with the written permission of the publisher.
Contact
E-mail [email protected]
Phone +49-(0) 69-2 11-1 16 70
www.xetra-gold.com
Published by
Deutsche Börse Commodities GmbH
60485 Frankfurt/Main
Germany
May 2014
Order number: 1610 - 3079
DAX ®, FWB ®, Xetra ®, and Xetra-Gold ®
are registered trademarks of Deutsche
Börse AG.
Reproduction – in total or in part –
only with the written permission of the
publisher.
The prospectus “Programme for the
Issuance of up to 10,000,000,000
Xetra-Gold Bearer Notes”, prepared on
07. July 2010, is binding. It is available for download from our website:
www.xetra-gold.com
The Issuer cannot be held responsible
for any misunderstandings or misinterpretation arising from this brochure.