Money Moves

New gold rush beacons bright prospects

by Ada Ng

Tony Fung, chief executive officer
Cocus Financial Group Company Limited
Photo: Wallace Chan

Gold prices have been reaching record highs, topping US$1,122 an ounce earlier this month. To benefit from this bullish trend, one gold bullion trading specialist has plans to expand its workforce to meet rising demand.

"We're seeing a growing confidence and strong interest in gold bullion trading, particularly in Hong Kong and mainland China," says Tony Fung, chief executive officer, Cocus Financial Group Company Limited.

Since there are only a handful of finance companies in Greater China specialising in gold bullion trading, Mr Fung anticipates ample opportunity to tap into the market.

Established in September 2008 as a specialist in gold and silver trading, Cocus currently employs 80 investment consultants. To prepare for an even greater demand for gold amid escalating prices, the company is looking to expand its advisory service team. "We aim to hire 40 additional consultants over the next year," Mr Fung says.

Gold bullion has historically been immune to inflation and global financial crises. Despite the recent volatility of the global stock and property markets, gold prices have rallied substantially with no sign of slowing since 2007, he notes, adding that he expects the massive demand for gold from the central banks of emerging countries such as mainland China and India to sustain the momentum.

Although mainland investors already make up about 70 per cent of the clientele of major bullion trading companies in Hong Kong, Mr Fung is confident that there is room for expansion. "India and China's love affair with gold is timeless and sustainable. It's deeply rooted in history and cultural traditions," he notes.

Consumers in these two countries see gold as a symbol of wealth and prosperity and, as they become increasingly affluent, their rising per-capital income will continue to drive demand. "These clients will remain the biggest gold buyers in the world and continue to boost bullion trade activities," Mr Fung stresses.

Cocus currently works with a consulting agent in mainland China, holding regular investment seminars in major Chinese cities to provide potential investors with market information and insights into different bullion-investment tools and trading activities around the world.

Part of the company's growth strategy is to cultivate its mainland customer base and Cocus is therefore looking to launch an industry-first gold option trading service in Hong Kong by end of this year. Once the new service is in full swing, investors will have the right to buy and sell any amount of gold bullion, Mr Fung explains.

"We're also working with a banking institution in Hong Kong to develop an "Gold Option" e-trading platform. Once this is up and running, our service will become widely available to clients on the mainland and overseas," he says.

Golden opportunities

  • Gold price continues to rise, fuelled by strong demand
  • Mainland China and India the world's biggest investors in gold bullion
  • Initiatives to strengthen mainland client base
  • Expanding advisory team to capitalise on China's growing affluence

Taken from Career Times 27 November 2009, p. A2
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