Friday, May 18, 2012
First Japanese Pension Fund to Make Public Purchases of Gold
Okayama Metal & Machinery has become the first Japanese pension fund to make public purchases of gold, in a sign of dwindling faith in paper currencies.
Initially, the fund aims to keep about 1.5 per cent of its total assets of Y40 billion ($500 million) in bullion-backed exchange traded funds, according to chief investment officer Yoshisuke Kiguchi, who said he was diversifying into gold to “escape sovereign risk”.
With institutions warming to gold, too, demand could grow further.
“If you look at assets over the past couple of decades, equity has been a loser, while fixed income offers tiny coupons,” said Yoshio Kuno, Japan head of Newedge, the futures broker. “Gold is becoming an acceptable currency substitute.”
(Editor's comment : Sounds like investment institutions are beginning to look at gold. I'm sure more and more will follow suit in view of the global financial instability.)
Excerpt from Original Source