SCOTTSDALE, Ariz., Sept. 7, 2017 /PRNewswire/ -- Monetary Metals announces that its Gold Exponential Fund™ is leasing silver at a cost of 1% per annum. By leasing metal, the Fund adds a fixed-cost tier to its capital structure. The Fund has access to leverage at a rate well under LIBOR, and hence below the cost of other funds.
The Fund obtained the metal via another Monetary Metals entity, which provides gold financing to businesses and pays a fixed income on gold to investors (and silver). The lease to the Fund is a win-win deal for the investors, enhancing the potential returns to the equity investors while paying interest on silver to the investors who lease the metal.
Equity investors in the Fund must be accredited, and tolerant of the risks of trading. The lessors are not seeking the same risk and reward, are not purchasing a security, and are not required to be accredited.
"We are excited to demonstrate synergy between our two businesses, with the Fund leasing metal from our fixed-income division," said Keith Weiner, CEO of Monetary Metals. He added, "the rate represents a balance between the interests of the Fund investors, who want a low cost of carry, and the lessors who want compensation for the use of their metal."
"I am happy to lease my silver to the Fund for this rate, because I am comfortable with its governance and confident that I will get my metal back," said Luis Rodriguez, a silver lessor in the deal.
About Monetary Metals
Monetary Metals® is Unlocking the Productivity of Gold™ by offering a Yield on Gold, Paid in Gold® to investors, and Gold Financing, Simplified™ to gold-using businesses. The company manages the Gold Exponential Fund™, which provides a way for investors to own gold and earn a yield, by trading between gold and silver. Monetary Metals publishes groundbreaking research to help investors understand the emerging role of gold as the ultimate measure of wealth, including the MM GOFO™ gold forward rate.
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SOURCE Monetary Metals