Gold trading volumes and futures demand subdued in July
Average daily trading volumes for gold jumped to US$151bn in July, above 2021’s average level of US$131bn. The increase came from the OTC market, and from futures on the COMEX and Shanghai Futures Exchanges. The latest Commitment of Traders (COT) report for Comex showed net long positioning at the lowest levels since April 2019 when the price of gold was US$1,277/oz or about 27% lower. We’ve discussed previously that overly extended bullish or bearish COT numbers can be contra-indicators for the future price of gold. This was the case in April 2019 as the price began its track higher shortly thereafter. Current futures positioning, along with the strong historical performance in the month of August since 2000, could provide an opportune time for establishing or increasing gold positions in the near term.
Outflows in all regions except Asia, with Chinese funds specifically having a strong bounce
- North American funds saw outflows of 50.3t (-US$2.8bn, 2.5%)
- European funds fell by 38.1t (-US$2.1bn, 2.2%)
- Funds listed in Asia added 8.1t (US$446mn, 6.0%)
- Funds in other regions had outflows of 0.7t (-US$38mn, 1.0%).5
SPDR® Gold Shares and iShares Physical Gold led global outflows during July
- In North America, SPDR® Gold Shares led outflows, with AUM dropping 44.4t (-US$2.5bn, -4%), while iShares Gold Trust lost 8.9t (-US$497mn, -2%). SPDR® Gold MiniShares Trust saw the largest inflows as holdings rose 4.5t (US$252mn, 5%), followed by iShares Gold Trust Micro which added 1.0t (US$57mn, 6%) -- both of which are in the low-cost space.
- In Europe, iShares Physical Gold lost 33.5t (-US$1.9bn, 11%) and WisdomTree Physical Gold shed 3.0t (US$167mn, 3%). Invesco Physical Gold was the only fund in Europe with meaningful inflows, adding 4.2t (US$235mn, 2%)
- In Asia, Chinese ETFs led the way with inflows in Huaan Yifu (3.9t, US$220mn, 15%), Bosera Exchange Traded (3.5t, US$194mn, 21%), and E Fund Gold Tradeable (1.7t, US$94mn, 16%).
Larger, liquid funds’ flows continue to move with the price of gold, while low-cost funds continue to grow, nearly every month
- Following three consecutive months of net outflows, global holdings of gold ETFs are now 5% (153t) higher y-t-d, below 2021’s annual inflows of 173t
- North American- and European-listed funds have absorbed a combined 159t of inflows in 2022 to date
- Chinese funds started the first half of the year leading outflows but had a resurgence with 15% growth in July.