It weighs 28.35 grams and has never been worth as much as this year: an ounce of gold is trading at $2,500, a level close to its historic record of $2,531 reached in August 2024. That is $1,000 more than five years ago! The main explanation for this recent surge is to be found in the demand for physical gold.that. “Emerging central banks, particularly Chinese, have been making massive purchases for three years, which is helping to drive up prices. Beijing is seeking to reduce its dependence on the dollar, while its reserves are currently largely invested in US Treasury bonds,” says Arnaud du Plessis, manager of the CPR Invest Global Gold Mines fund at CPR Asset Management.
The indicators remain green for the coming months, this time in a context of lower key rates in the United States. Indeed, since gold does not provide a yield (unlike stocks and bonds), it is traditionally less sought after when interest rates are high, and, conversely, it records a resurgence of interest when they fall. However, the American Federal Reserve should start to lower its rates by the end of the year if inflation begins to decline. “The ounce could head towards a new record at 2,800, or even 3,000 dollars, within twelve months,” anticipates Alexandre Baradez, market analyst at IG.
The yellow metal also maintains its status as a safe haven that investors turn to when things go wrong. The war in Ukraine, the situation in the Middle East and geopolitical tensions between the United States and China regularly influence prices. From a more structural point of view, gold also constitutes a good source of diversification. “Holding between 2% and 5% of your assets in the form of gold makes sense, because it protects against inflation,” recommends Benoist Lombard, the president of Maison Laplace.
There are several solutions available to interested investors. The most classic is to buy coins such as the 20 franc Napoleon, 1 kilo ingots or 100, 250 or 500 gram ingots from a specialist pharmacy. Here again, prices are close to their peak: the 1 kilo ingot reached a record high of 73,470 euros at the end of August, and is now worth just over 71,000 euros, or 18% more than at the end of December 2023.
Around 3% fees
Savers buying coins and bars must pay around 3% in fees. Given the sums involved, they must of course be stored in a safe, at home, in a bank branch or via the storage solutions offered by certain counters. In addition, it is imperative to keep all the documents provided by the intermediary at the time of purchase in order to be able to resell, when the time comes, under good conditions, particularly tax conditions.
“The parts are sold in sealed bags that guarantee their traceability, they must not be opened”, explains Laurent Schwartz, CEO of the Comptoir national de l’or. The ingots are sold with a certificate of authenticity guaranteeing their titration, that is to say the quantity of pure gold contained. It can happen that the price of a coin or an ingot is higher than its weight in gold. This is called a premium. This reflects supply and demand: when there are many buyers, the premium increases, and vice versa. The ideal is to buy when the premium is low, and to resell when it is higher. “The premium currently stands at 4% on the Napoleon, a reasonable level compared to a historical average of around 6% to 8%”, illustrates Laurent Schwartz.
It is also possible to invest in gold via financial investments such as ETCs (exchange traded commodities), listed securities on the Euronext stock exchange whose price replicates the evolution of the price of an ounce of gold. These ETCs offered by Invesco, iShares, Xtrackers, Wisdom Tree and Amundi are invested in physical gold. “Ingots are bought – or sold – every day depending on the evolution of the outstanding amount of our product, then placed in the vaults of JPMorgan Chase in London”, relates Thibaud de Cherisey, head of EMEA ETF distribution at Invesco. However, these products involve an additional share of risk associated with their issuers, since they are a financial investment. But the advantages are numerous: there is no need to worry about storage, as with the purchase of coins or ingots. In addition, “you can split your investment, since our ETC is listed at around $225, while an ingot is worth €70,000”, adds Thibaud de Cherisey. Finally, funds replicating the price of gold are traded on the stock exchange with very low brokerage fees (from 0.1 to 0.50%).
Another solution is that funds invested in mining company shares are also benefiting from the surge in gold prices: they have gained 18.91% since January 1 (as of August 23), according to Morningstar. Gold mines are directly benefiting from the rise in gold prices. “Production costs have been increasing sharply since 2019 due to rising energy prices and wages, but the rise in prices is now allowing companies to rebuild their margins,” explains Charles-Edouard Bilbault, manager of R-co Thematic Gold Mining at Rothschild & Co. Asset Management, whose fund is diversified across stocks mining other metals, such as silver, copper and nickel.
A few rare funds are exposed to the price of gold, and not to mining stocks. This is the case of OFI Invest Precious Metals, from OFI Invest, whose objective is to offer exposure to the evolution of a basket of four precious metals (gold, silver, platinum and palladium), via derivative products. It has increased by 8.68% over a year. “Exposure to a basket of metals rather than just gold ensures sufficient diversification to comply with European UCITS regulations, which allows the fund to be eligible for life insurance,” explains its manager Benjamin Louvet. As for the Or physique fund, from Financière de la Cité, it is a professional fund (minimum investment of 100,000 euros) invested in physical gold kept in the vaults of the HSBC bank in Great Britain. It is eligible for Luxembourg life insurance contracts, but not for French contracts.
Each to their own tax regime
In terms of taxes, there are several rules depending on the medium you have chosen. Gold coins and bars are subject to the precious metals tax of 11.50% upon resale. This is calculated not on the capital gain made, but on the amount of the sale. It therefore applies even in the event of a capital loss.
It is however possible to opt for another, more advantageous tax regime, provided that you can justify the date and purchase price of your coins and ingots with an invoice. In this case, the capital gains tax of 36.2% applies, after a reduction of 5% per year from the second year, which therefore corresponds to a total exemption after twenty-two years of ownership. In practice, it is necessary to check which regime is the most advantageous depending on the date of purchase and the capital gain.
The taxation of paper gold is very different: gains made on funds invested in gold mines and on ETCs exposed to gold are subject to the single flat-rate levy of 30%, as for all securities held in a securities account. Investments made within the framework of life insurance benefit from the favorable taxation of this envelope.
An article from the special report “The best investments for the start of the school year”, published in L’Express on September 19.
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