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FAQ's

These frequently asked questions contain responses to some common questions asked by our clients, professionals within the financial industry, investment funds and banks regarding our models and their performance.

 If we do not cover all of your queries here, then please contact us directly at sales@auctusmetals.com 

Auctus Definition: Latin word meaning growth, the act of increasing, enlargement and prosperity. This being our company directive in regard to our clients’ portfolios. 

We are specialist bullion dealers. The Auctus business model is intended to manage client physical metal bullion portfolios and adjust their percentage weightings of differing precious metals over time. Auctus portfolios are comprised of the following precious metals; gold, silver, platinum, palladium and rhodium, proportionally according to our proprietary model algorithms. This can deliver returns to our clients over and above a purely static physical metal holding.

Our clients have two options of holding their portfolio – either a Segregated Vaulted Account or a Singapore Managed Portfolio. These options exist solely to accommodate our client’s individual circumstances. The Auctus team can discuss these circumstances with the client to determine which is the most suitable solution for our client’s best interest. Furthermore, Auctus always recommends that our clients seek independent legal advice to confirm the option that suits their specific individual circumstances.

We always provide complete visibility of client’s metals, valuations and insurance which are independently audited. In addition, clients maintain fully-allocated sole ownership rights at all times. We produce exhaustive analysis of metals markets through the combined strength of our unique partnerships with four independent global bullion and logistic companies. This allows us to leverage off their size, market experience and knowledge, logistics network and client base for the benefit of Auctus, and ultimately for our client’s advantage and profit. Every single client’s portfolio is treated as a unique bespoke investment and is dependent on the client’s preference of portfolio. Our algorithm updates the portfolio mix regularly, although different entrance dates can result in completely unique percentage weightings for clients with the same portfolio. 

Auctus model portfolios have indicated an out-performance against many other more classical asset class holdings such as stock indices, bonds and investment stock funds. 

NET Cumulative Compound Annual Growth Rate (CAGR)  – Valued in US$

 

1 Year

Return

2018

2 Year

Return

2017 to 2018

3 Year

Return

2016 to 2018

4 Year

Return

2015 to 2018

5 Year

Return

2014 to 2018

10 Year

Return

2009 to 2018

15 Year

Return

2004 to 2018

20 Year

Return

1999 to 2018

Model 1

2.04 %

per annum

36.28 %

per annum

40.74 %

per annum

17.39 %

per annum

12.39 %

per annum

15.36 %

per annum

19.22 %

per annum

19.57 %

per annum

Model 2

13.60 %

per annum

52.47 %

per annum

47.53 %

per annum

18.69 %

per annum

14.46 %

per annum

17.60 %

per annum

20.47 %

per annum

20.59 %

per annum

MSCI USA Index

-0.93 %

per annum

5.65 %

per annum

6.46 %

per annum

1.48 %

per annum

1.21 %

per annum

3.93 %

per annum

7.77 %

per annum

7.74 %

per annum


* Note:
  MSCI USA  – Large and mid cap segments of the US market, covering 85% of the free float-adjusted market capitalization in the USA

It must be noted that generally, clients that invest in physical metals are already of the view that a diversification into physical gold is an extremely important wealth preservation asset that has no 3rd party liability if held in the client’s own name inside highly secure vaults (as opposed to an ETF or other financial institution offering). Auctus metal portfolios provide the same advantage. Throughout history sovereign governments, banks, pension funds, etc.. believe holdings of gold are integral to the overall health of their portfolios.  

The primary risk to our client’s portfolios ‘managed’ by our company models are that a static ‘non-managed’ gold holding outperforms other precious metals over time. This would mean metal price ratios and production cost and supply relationships break down completely and our modern-age imperative demand of metals in production no longer exists. Considering each metal has its own unique scientific properties which are irreplaceable,  it explains why this has never happened historically

Our models swap between physical precious metals as our proprietary models recognise investment opportunities – an average of around 5 trades a year historically.

For the benefit of our client base we have gone through an exhaustive audit with one of the world’s largest auditing companies. Their actuaries have back-tested our models using 48 years of daily metal data, examining every aspect of the mathematics and algorithms which effectively covered every possible economic event – from bear markets in metals, extreme global inflation and also deflationary events, wars, banking crises, oil crises and the GFC. The model results have proven themselves without mathematical doubt. (Please contact the Auctus team for details of our Audit certification on sales@auctusmetals.com)

We have developed sophisticated mathematical algorithms and also utilise added data variables to further enhance the performance of our portfolios. Although we already have a very good idea of what the metal weightings should be, the benefit of the use of the algorithms is that they are consistent and fixed, measuring over multiple variables.

Major trade trigger events are always analysed and overseen by management to verify the input data source and identify any possible anomalies.

Our portfolio algorithms are focused entirely on extracting the optimum returns for clients by identifying breakdowns in the precious metal correlations which present a trading / investment opportunity. Presently we have identified several extreme imbalances in the metal prices representing an immediate opportunity for clients. Remember we do not measure our models against US$, but rather metals against one another. The return against US$ takes care of itself.

The longer-term investment opportunities at this time are signalling huge generational entry levels and are very exciting, we believe, for our client base.

Please Note:  All trade costs are reported to the clients in their allocation reports.

Considering we are dealing in the wholesale market, we constantly endeavour to provide the most advantageous price using multiple supplier contracts. It must be noted however that market conditions and liquidity factors may well impact buy and sell prices, hence we cannot commit to a specific guaranteed spread price.

Client confidentiality clauses and the fact that we are not a fund, rather a precious metal portfolio management system removes the obligation to publish this figure. We can state that we have substantial funds under management with this figure increasing meaningfully each month.

 

The points raised above are not actually correct. Metals move in ranges of value against each other in clearly defined ranges over differing economic periods as they have unique pricing relationships. Our portfolio algorithms are focused entirely on extracting the optimum returns from an already acceptable performing asset class (precious metals) by identifying significant opportunities not recognised by standard, or even pro-active analysis.

Although typically paper gold and silver are negatively correlated to the US$, participation in the other more volatile PGM’s (platinum, palladium, rhodium and ruthenium) that usually thrive during high economic growth periods or supply driven shortages due to mine production falls, tend to offset what are normally slow growth periods for the typical precious metals such as gold and silver.

It is true – silver under-performs gold when both their prices are falling against the US$, but historically the exact opposite is true when the metals are rising against the US$. Silver historically can outperform gold by over 100% in these periods of price rises. Our models are constantly taking advantage of these situations, and indicate returns far in excess of static metal holdings.

We can agree many of our investors treat PM’s (physical precious metals) as a non-yielding insurance policy to cover and protect against counter cycles in equities, financial crisis, wars, currency collapses, sovereign government crisis or indeed sovereign government debt crisis. The average physical metal investors are extremely cautious as investing in physical precious metals is their guarantee against their paper / digital markets completely breaking down. That’s why we never move them out of physical holdings at any time; just the percentage of which metals within the precious metals they hold.

We are not implementing a trade intensive platform as we are only looking at between 4 to 6 trades per year. It’s more about identifying infrequent opportunities within the PM class to maximize the total metal value of the original holding, hence achieving a high yield.

Clients classically hold only a small part of their overall investment portfolio in physical metals and the balance of their wealth chasing higher yielding investments in stock markets, properties, bonds etc. Auctus model portfolios actually the two areas, allowing them to allocate a certain percentage from both allocations into this physical metal ‘hybrid’ investment portfolio.

The financial industry including banks and investment funds regularly incorporate financial analysis within a trading strategy by back-testing investment strategies, or risk modelling. Back-testing seeks to understand and measure the performance of a strategy or algorithmic  model as if it had been employed during a past period. As long as the testing is executed under the strictest of criteria, this information is extremely important. Back-testing refers to applying a trading system to historical data to verify how a system would have performed during the specified time period. The majority of today’s financial markets investment models and platforms support back-testing. We cannot predict the future, but we can certainly prove if our model’s methodology works historically across many differing market conditions over many decades of price history.

Auctus models have been independently mathematically audited. We use strict retrospective price back-testing, incorporating all daily metals data going back to 1972.

The performances achieved are net after costs are stripped out. Deductions include management fee of 1%, vaulting costs of 0.25% and bid / offer spreads on metals swaps of every trade instigated.

Auctus fully instigates the metal swaps required based on trade trigger events generated by our proprietary models that are analysing the markets daily using live feeds. We trade your physical holdings at the best wholesale prices, and we are also constantly checking physical market product prices through our extensive partnership network. We have several very strong relationships with refineries, wholesale suppliers and bullion dealers and hence we take this process completely out of your hands.

Part of the agreement clients are required to sign, effectively gives us the ability to execute the metal swaps. Our clients would of course be notified immediately of any adjustments in their portfolios.

Of course, the client can withdraw at any time, divesting from the portfolio and withdrawing funds in cash, which will be transferred to the client’s nominated bank account. Instructions to draw-down on the fund, either reducing the size of the allocation or selling out completely is covered specifically in our terms and conditions and would depend on the liquidity of the metal your portfolio is invested in at that time.

Auctus is committed to ensuring that your privacy is fully protected and held to the highest levels of encryption. Should we ask you to provide certain information by which you can be identified then you can be assured that it will only be used in accordance with our very strict Privacy Policies and in compliance with the Personal Data Protection Act 2012 (PDPA) and the Data Protection Act 1998 in Singapore.

Please contact us direct to request an application form. You can call this number +65-315-827-91 or email us at sales@auctusmetals.com  with your enquiry and we will get back to you straight away.

Clients will need to confirm in writing whether they are bringing over an existing metal allocation into the vault or injecting cash capital into a physical holding or both. Clients will need to fill out our Account opening form and choose their preferred portfolio and method of holding described above (Segregated account or Singapore Managed Portfolio)

Several documents are required to identify the client including passport and address confirmation and various other details will also be required for identity verification.

The following information in relation to the taxation treatment of investment in precious metals is of a general nature only and you should seek your own advice specific to your particular circumstances. This information is specific to individual investors who invest in their own names or directly through their superannuation fund, family trust or private company.  If you are investing via another entity you should seek further taxation advice.

Depending on our client’s  tax  jurisdiction, normally where you sell precious metal for cash, a capital gains tax event ordinarily occurs. For the purposes of calculating, any capital gain, you subtract from the cash amount  received the original value of the sold metal as at when you first acquired it, as well as the costs associated with holding it, such as management fees. Where an individual, trust or super fund has held the precious metal for more than one year, any capital gain can be discounted by 50%. The discount is unavailable where a company has held the precious metal.

If you are not dealing with someone at arm’s length, then instead of taking the cash received figure for the purposes of calculating your capital gain or loss, use the market value of the precious metal at the time of sale. The gain or loss is included in your income tax return.

We always recommend that our clients gain independent legal and tax advice prior to making an investment into any of the Auctus managed portfolios.

Depending on our clients tax jurisdiction if you are in the business of buying and selling precious metals, profits that you generate are ordinarily treated as your taxable income. Your costs associated with this activity are ordinarily deductible expenses. If you are in the business of trading precious metals, or you are unsure whether your trading constitutes a business, you should seek advice specific to your circumstances.

We always recommend that our clients gain independent legal and tax advice prior to making an investment into any of the Auctus managed portfolios.

The role of Auctus is only to facilitate your precious metal investment and trades. Because you directly own the precious metal you have purchased, you will not be exposed to any risk associated with the financial position of Auctus. If you choose the Singapore Managed Portfolio option, you will also be protected with a call option, which you can exercise at any time and take possession of your physical precious metal’s portfolio. Please seek advice specific to your circumstances should this be of concern to you.

IMPORTANT: Please note that all information contained in these FAQ’s is general in nature and are not intended in any way to constitute, or replace the need for, the provision of financial advice. These FAQ’s do not take into account your personal objectives, financial situation or needs. You should consider whether the information in these FAQ’s is appropriate for you given your unique circumstances and obtain financial advice that is tailored to your circumstances from a suitably qualified financial advisor.

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