Gold Exchange-Traded Fund targets Botswana SE

Absa Capital of South Africa says it is getting closer to a secondary listing on the Botswana Stock Exchange (BSE) of an Exchange Traded Fund. The NewGold Gold Bullion Debentures (NewGold) is the world’s third largest gold ETF and the largest on the South African Stock Exchange (JSE Ltd).

The listing could come by December, but first regulatory approval and finding a local partner is required, according to a report in Mmegi newspaper. Absa Capital is keen for the fund to classified as a local asset in terms of investment requirements, and they are discussing with asset managers and others to support it.

Absa Capital Associate Principal Dr Vladimir Nedeljkovic reportedly told a media presentation at the BSE that NewGold offers institutional and retail investors a new asset class and a chance to invest in gold in a cost-effective, secure and efficient way. The ETF was apparently developed in association with the World Gold Council. NewGold Gold Bullion Debentures are securities backed by the physical gold-bullion. Each NewGold Debenture is initially valued at 1/100 of one fine troy ounce of gold.

According to the report, the BSE suffers low liquidity and instruments such as this could help attract more trading and capital. Local fund managers reportedly invest up to 70% of their funds under management outside Botswana, partly due to lack of opportunities.

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