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Investment ISAs /

Gold ISAs

Gold ISA funds provide an good opportunity for investors to diversify their portfolio away from traditional asset classes such as shares and bonds. However, investors need to be prepared to take a long term perspective.

Selected ISAs

Physical Gold ETC Fund

from iShares

ISA Option
Allows ISA Transfers
Regular Savings
  • Fund Choice: Offers exposure to changes in the price of gold - an important investment commodity. This fund is backed by physical gold.
  • Invest From: £50 pm

Available via Fidelity Fund Supermarket this fund provides low cost exposure to the gold market with a 0.25% pa annual charge. iShares physically-backed Exchange Traded Commodities (iShares Physical ETCs) are series of secured metal-linked debt securities that trade on one or more regulated exchanges and offer investors easily accessible, liquid and transparent exposure to physical precious metals. iShares Physical ETCs provide investors with exposure to the performance of individual precious metals without the need to take physical delivery or trade commodity futures contracts. The iShares Physical Gold ETC seeks to track the day-to-day movement of the price of gold, less fees, by holding gold bullion. The gold bullion backs the securities issued and is valued daily at the London PM fix price. The gold bullion is held as allocated gold bars with the custodian, JPMorgan. State Street acts as the Trustee. iShares Physical ETCs are exchange traded commodities and are neither funds nor exchange traded funds.

Please note the value of investments can go down as well as up so you may get back less than you invested. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.

What are gold fund ISAs?

Gold ISAs are a type of commodity fund ISA. The term 'commodities' covers a huge range of goods and materials including fuels, staple foods, and precious metals.

Different types of commodity fund ISAs include:

  • Funds that invest directly in commodities, e.g. precious metals such as gold or natural resources. These are 'true' commodity funds, in that they are direct investments in the commodity itself.
  • Funds that invest in commodity-linked derivatives. This is a common investment strategy within the commodities market as it allows investors a rate of return that's linked to the future market performance of their chosen commodities.
  • Funds that target shares in commodity-related companies, such as agriculture, energy, or mining companies. These investment products are also known as natural resource funds, and focus on companies operating in the commodities market, rather than on the commodities themselves. Investments may be made in industries such as mining, agriculture, oil, and energy.
  • Funds that invest in a combination of the above. Some fund management plans allow you to invest in commodities and commodity-linked derivatives. So, you could invest in a fund that encompassed both gold bullion and gold futures.

What are the benefits of investing in commodity fund ISAs?

  • They ISA wrapper is tax-efficient. By investing in a commodity fund ISA, you benefit from not paying capital gains or income tax on any potential returns.
  • Commodities offer an opportunity to diversify your investment holdings away from traditional plans such as shares and bonds. Having a diverse portfolio can help to cushion your investments against any falls in particular areas because it allows you to avoid putting all your eggs in one basket.
  • Although the risks are high, the returns have the potential to be similarly high. This may be linked to the recent emergence of new economic powerhouses such as China and Indonesia, which require a lot in the way of resources to support their rapidly-developing commerce and infrastructure.

What do investors need to be aware of when considering commodity fund ISAs?

  • Commodities investments require you to be comfortable with risk, as well as prepared to take a long-term approach to reaching your financial goals.
  • Some funds place limits on the percentage of the portfolio that can be invested in a single commodity, in order to avoid too much focus on a single investment area.
  • There may be charges involved in transferring current ISA balances to a commodities fund ISA, so check with your chosen provider.
  • The commodities market is notoriously volatile and is high risk investment area. It's therefore generally better suited to experienced investors. As with all investments, if you're unsure, seek independent financial advice.
Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

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