Bard Santner, an asset management firm, recently unveiled a new product; a unit trust that owns Gold coins. It’s an exciting development that widens the options for Zimbabweans in terms of saving products. Since the launch of Mosi Oa Tunya gold coins, they have proven an excellent store of value compared to the Zimbabwean dollar. Now Zimbabweans can access gold coins as a savings mechanism.
Initial reports erroneously claimed the Unit Trust was to be listed on the Victoria Falls Stock exchange. While the unit trust will be sold for US dollars, it will be an over-the-counter product which means you buy directly from the asset manager, in this case, Bard Santner. The minimum investment amount is US$120, but Bard Santner will allow units to be purchased at US$15 per month. That brings a lower entry threshold than buying gold coins outright, even with the smaller denominations.
The gold coin unit trust has a vesting period of 180 days, so you will not be able to liquidate your savings before 180 days of holding. Thereafter there is a further 7-day waiting period to withdraw funds.
Bard Santner is an asset management company registered and licensed with the Securities Exchange Commission of Zimbabwe (SECZim). Recently registered, they made news in September 2022 when they assumed the remaining clients of Tetrad Financial Services. The Gold coin unit trust joins their High Income Fund and Segregated Equity Fund under their asset management products available to the public.
Unit Trust Funds are pooled investment funds split into multiple small units. They are managed funds, meaning that a team of people works hard to work out the best possible investment targets to bring the fund’s owners the best return. Unit Trusts have the advantage of being funds managed by professionals and requiring little work on the part of the investor. However, they are not the easiest investments to get into. They also lack flexibility as many have lock-in or vesting periods, essentially minimum holding periods before you can cash out. Finally, the fund managers are rewarded for their work, and fees are something to look out for in any managed fund.
How to buy units
You can buy units in the fund directly from Bard Santner. They have a simple sign-up page on their website; they will contact you once you give your details. You can also contact them by email or find other contact details on their website.
The gold coins, whilst they have been the subject of much misinformation, have had a purpose that was clearly spelt out from day one: a store of value. To that end, gold coins have performed brilliantly, particularly when compared to the local currency. However, the constraints on the minimum entry are still relatively high. The Bard Santner, gold coin unit trust, brings all the advantages of holding gold coins without some hassles.
The lower entry price, coupled with the ability to exit in bits and pieces (you don’t have to sell all your units, you can partially liquidate), make it a great addition to the saving landscape in Zimbabwe. The significant drawbacks are selling in US dollars, where many still earn in local currency and the 180-day vesting period.