Every client at a new wealth management
boutique, Yellow Capital Wealth Management (Yellow Capital), will
have exposure to gold in their portfolio – tapping into the
commodity’s upward trajectory.
Focused on private clients with a net worth in
excess of £1m ($1.5m), the independent fee-based wealth manager
will allot every client between 10% to 15% gold exposure in their
portfolio, unless they specify otherwise.
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Yellow Capital, launched by independent
financial advisers (IFAs) Haydn Ellwood and Scott Sander, said it
has a “strong belief” in the prospects for gold.
As a tangible asset, gold has traditionally
been seen as a safe haven investment and a hedge against inflation
in times of high market volatility. Price in the precious
metal has soared to about $1,250 a troy ounce, more than 100%
higher than levels of three or four years ago.
Ellwood told PBI that despite being
“gold bugs” Yellow Capital was not launched directly as a response
to the rising price of the metal.
“We have been gold bugs for a while and it
takes a long time to set up a business.”
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By GlobalDataTo illustrate this, Ellwood said he recently
turned away an investor who was looking at investing in gold over
the trajectory of a year. Ellwood said this is not a long
enough period for a gold investment and would be too risky.
“Gold is something you should lock in your
safe at home, not buy and sell everyday. I’ve seen people
ruined on gold and I wasn’t willing to take that risk,” he
said.
He added that despite the “gold-mania” that
has gripped the media, it is central banks that have invested in
the metal and influenced markets.
Yellow Capital is involved with about £150m
assets under influence and has a medium to long-term goal of
acquiring £1bn of assets.
“Scott and I wanted to bring a new, young,
warm and vibrant brand to today’s financial services market.
We saw a huge opportunity, particularly with private clients, as
gaps have been created in that sector by private banks over recent
years,” Ellwood said.
In addition to developing the business
organically, Yellow Capital will also look to acquire similar
businesses with clearly identified private client portfolios
including retiring IFAs.
