Gold is often perceived as an investment haven due to its enduring ability to retain its value and mitigate the impact of inflation. It is the world’s oldest international currency and has proved to be one of the leading asset classes of the 21st century. According to a study by Rhodes Precious Metals Consultancy commissioned by RAKBANK, gold has produced an average return of almost 13% per annum since 2001, easily outperforming US equities which grew at an annual average of just 6% over the same period. In the UAE, the size of Dubai’s physical gold market has grown from just under $5 billion in 2002 to over $55 billion in 2014, with the emirate acting as the logistical bridge connecting the world’s major physical gold markets.
To provide customers with the opportunity to diversify their investment portfolio, RAKBANK launched RAKGoldInvest, an investment tool that allows High Net Worth customers to invest in gold electronically whilst saving them the hassle of storing and moving the gold. Customers can buy, sell, or hold their investments 24/7 via an online trading platform on the Bank’s corporate website, and can convert their RAKGoldInvest holdings to physical gold bars at any time.
This is the second gold-themed product launched by RAKBANK in 2015. In January, RAKBANK partnered with Kalyan Jewellers to launch a co-branded Credit Card. The RAKBANK KALYAN JEWELLERS MasterCard Credit Card, which is accepted globally for purchases and cash withdrawals, offers ‘Goldback’ loyalty points that are earned at a rate of up to 7% and can be redeemed at any Kalyan Jewellers outlets in the UAE in the form of jewellery. To ensure customer convenience, the card also offers a 0% easy payment plan on diamond and gold jewellery purchases.
“RAKBANK recognizes the strong appeal of gold investments especially among Asian communities who still largely consider them to be the ultimate store of value even with the introduction of modern financial instruments and asset classes,” said Peter England, RAKBANK CEO. In fact, demand for gold was virtually exclusive to Asia before the Global Financial Crisis in 2008 but since then there’s been a significant move into gold worldwide as an alternative hard asset to traditional paper investments such as equities and bonds.*
Gold’s purchasing power grewby 10.72% in USD terms between 2001 and 2014 compared to a 2.27% increase in US Consumer Prices. The proof of gold’s enduring ability to retain its value and mitigate the impact of inflation is also highlighted by an increase of more than 43% in the yellow metal’s purchasing power since 2001 compared to that of crude oil.*
“With the launch of RAKGoldInvest and the Kalyan co-branded credit card, RAKBANK offers flexible, convenient, and simple gold-themed products that aim to diversify customers’ investment portfolio,” added England.
Existing RAKBANK customers can apply for RAKGoldInvest online through the Bank’s Online Banking platform while new bank customers are invited to visit one of the bank’s 35 branches in the UAE.