Quote Originally Posted by TheHeathens View Post
The above shows your misunderstanding of mutual funds. Collective investments (funds) lower the costs because you are sharing them with other people. Coincidentally, the BlackRock fund actually invests in shares gold mining companies and not physically in gold itself.

A gold exchange-traded fund (ETF) tracks a gold prices index, but is backed by allocated gold held in a vault on behalf of the investors. It allows people to participate in the gold bullion market without actually taking delivery of the gold.

The price of the shares in the ETF rise and fall in line with the gold price but you can short-sell (in the media at the moment!) to gain from falls in the market. Because it's a tracker fund, it requires very little management and fees are low.

The average fees for a gold ETF are about 0.4% per annum - I dare say that just insuring the gold alone would cost a lot more than that per year as an individual investor. If you bought gold though Bullion vault, it would cost you 0.92% per annum in fees (for them to hold and insure it for you, in addition to their commission) - more than double the price.
I know all this, but you're missing My point. My comments are not based on normal conditions, they're based on a worse case scenario I.e. the collapse of the pound. In that case it's no good having gold in a fund or shares in a gold mining company in South Africa.