The Swiss Industrial Metal AMC is an actively managed certificate that is covered with a portfolio of base industrial metals including copper, nickel and tin and various minor metals including cobalt, molybdenum and indium. All of the metals the certificate invests in are stored in an insured Swiss bonded warehouse and mainly sold to the production industry.
We have formed a partnership with the Swiss Metal Exchange, providing us with a direct connection to the metal processing and manufacturing industries. This gives us important insight into what’s going on in the supplier and sales markets and enables us to trade metals at lucrative terms. These factors are hugely important in what can be an inefficient market.
All metals currently kept are physically stored in Switzerland, so in addition to receiving a certificate, investors can also rest assured in the security of the deposited metals, which they can see and touch on site. Even in an economic or systemic crisis, the certificate is reinforced with these tangible values. A special purpose vehicle (SPV) has been set up in Jersey (UK) to issue the certificate, ensuring there are no counterpart risks. The metals are stored in the OCW (open customs warehouse) of Metal Depot AG which guarantees them under the protection of Swiss customs supervision. The correct allocation is ensured with customs as the inspection body and the commodity numbers assigned to it. This gives our investors yet another layer of security. Finally, the metals are insured at all times during transport and storage.
Investing in the Swiss Industrial Metal AMC represents an attractive opportunity to diversify into the raw materials sector and participate in a market with high return potential but that can be difficult to access. Many of the metals we hold are difficult to trade on the stock exchange due to their illiquidity. We aim to grant potential investors access to these illiquidity premiums and thus generate added value. By pooling the assets of all investors in the certificate, we are able to keep storage and transportation costs low through economies of scale. Similarly, large trading volumes can be an important advantage in buying and selling negotiations in the metals markets.