The gold price performed strongly over the past year while bond prices tanked. Kanish Chugh from ETF Securities and Owen Rask talk about how to use gold in a portfolio, why bonds are still relevant and how to build a diversified portfolio.
Kanish is a regular guest on The Australian Investors Podcast. Be sure to subscribe if you like the show and want to get into the investing weeds more often.
Gold price (USD)
Get Owen’s take on the Best Gold ETFs in Australia on Best ETFs.
List of questions answered during the gold v bonds podcast episode:
Quickfire (sub-60-second answers):
- What’s been the best investment you’ve made?
- What’s been the worst investment?
- Who’s the best finance presenter (e.g. at an event presentation, in a video, TedTalk, etc.) you’ve ever seen?
What are the 2-3 things you would look at if you were researching a commodities-focused fund?
Why has the gold price done so well for Aussie investors?
How much is too much gold in a portfolio?
When you’re looking to get information or insights on using commodities in a portfolio, which resources do you use (websites, particular analysts/authors, etc.)?
Recently, bonds have taken a turn for the worst as long-duration assets have been hit by rising interest rates. Global fixed interest and Aussie fixed interest ETFs have both been hurt. For example, the Vanguard VIF bond ETF is down from over $50 in 2020 to around $40 at the time of recording (a ~20% fall). Do you suspect we’ll still see weakness in long-duration assets?
Imagine you had a hypothetical 60/40 portfolio in front of you, Kanish. It’s a blank canvas but you know it has 60% growth assets, 40% risk-off assets. So the portfolio is 40% defensive assets, which could include whatever defensive assets you think about. How would divvy up that 40%?
Why did ETF Securities decide to launch two new funds, USD High Yield Bond (Currency Hedged) ETF (ASX: USHY) and Treasury Bonds (ASX: USTB), right now?
One of the things investors might question with these two funds is tracking error. Why do the two ETFs exhibit tracking error?
High yield credit is particularly interesting to me. If we could leave investors with 2 or 3 key insights about high-yield bonds what would they be?
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