Hellogold is not a trading platform to take positions in and out of gold throughout the year. Holding any asset or less than a year is not really for investment. It is designed to be a long term savings (c 3-5 years) vehicle for people to access investment grade gold at an affordable transaction size and which will also allow them to get access to personal financing at an affordable rate

In terms of gold as a hedge, it is not a good short term hedge as gold tends to be completely uncorrelated 1) in the short run to most asset classes and 2) when markets are behaving 'normally' or volatility is normal. Gold acts as a great hedge - in the emerging market context of the ordinary people of ASEAN- against any weakening of the local currency in the short term and against inflation in the long term

You are correct to be concerned with how any start-up is set up and looks at risk management. We manage our transaction records very carefully

1) we publish our customer records in public at the end of each day so that everyone can examine them and reconcile these to the gold positions
2) every time a customer makes a transaction, it is recorded not just on our database but a record is posted in his app and confirmation is sent to the customer
3) We have appointed Deloitte as our auditors- they will provide us with feedback on the strengths and weaknesses of our internal controls on an ongoing basis
4) we are currently developing a series of blockchain contracts that will enable us to move our customer records from the traditional database which can be manipulated as you pointed out to a private blockchain where records are by their nature immutable. When this phase of work is complete, we believe that our customer records will be safer from a immutability perspective than those held in most traditional banks
5) I believe that the company HelloGold keeps will provide additional comfort to our customers. Our launch partner is Aeon Credit Services in Malaysia. We also hope to be announcing a tie up with one the largest banks in ASEAN in the next month or so. Moving further along, we are in discussions with one of the largest mobile Operators in the region as a partner and a key investor who helped to launch one of ASEAN's most succcesful start-ups in recent years

We are focused on helping ordinary people in ASEAN save better and get access to more affordable financing. There are plenty of banks and brokerage houses who have great products to offer but they only really make these available to the wealthy and mass affluent and not to everyone

Sorry - what's TS?

Thanks! We simply want to serve the markets that the big guys don't want to serve

We are very transparent about what we charge - https://help.hellogold.com/en/category/fees/ - we want customers to know exactly what the fees are so that they can make an informed decision

As I have said in a number of other posts, the gold is fully allocated which means that 100% of the customers' gold sits in the vault 100% of the time. In fact, we are over-allocated in that we have more gold sitting in the vault that our customers gold has. I have summarised what I have posted in previous replies here and I will include the link for you to review at your leisure

At the end of every day, HelloGold publishes a number of statements that show 1) the amount of gold our customers have with us 2) the amount of gold that we have with our vaulting agent according to our records and the corresponding bar numbers 3) a link to our vaulting agent's site that also displays the amount of gold that they hold on our behalf according to their records with the corresponding bar numbers

https://help.hellogold.com/en/how-do-i-know...stored-is-safe/

Over and above this, if customers want to check on the gold, we can organise for them to visit the vault in Singapore. Obviously this necessarily needs to be arranged during the working week and during working hours

In terms of the personal financing question, in ASEAN, less than 20% of loans granted to individuals were from banks or non-banking financial institutions. In contrast, more than 25% of individuals borrowed from friends and family, private lenders and employers. Where unsecured bank loans are available, the financing costs are extremely high with an effective lending rate of 15% to 25% in Malaysia as an example. SO we have tied up with Aeon Credit to try to help our customers get access to more affordable shariah loans.

Say you have 10 grams of gold that is worth RM2000, and you need access to emergency cash, Aeon will provide you a loan for 70% of the value of the gold for a year for a fee that will be equivalent to 8+% p.a (but this is subject to confirmation). So you don't have to sell your gold to get cash and you have a year to pay off the loan. Obviously if you don't pay off the loan on time, Aeon will instruct HelloGold to liquidate the gold and repay them the outstanding debt. Any remaining monies after the loan has been settled would be returned to the borrower

We have plans to bring on the other precious metals (silver definitely, potentially platinum too) - probably in 2018. Right now we are focused on launching a number of other products and features for gold

Given the questions and concerns that many rightly have about whether gold products are scams or not, I thought I would share with you an article I wrote for the Edge. It sets out the key attributes that people should think about when they are looking at using any gold provider - whether it is HelloGold or any other platform

http://www.theedgemarkets.com/article/opin...all-glitters…

Thanks for the feedback. We are launching some new features in the next month to the application which we hope will be interesting and useful for our customers. And we will be announcing an investment by a major singaporean bank and a singaporean government fund in our business.

If you have any questions at all, please feel free to post it here or ask us on the chat function on the app

Robin

I wish you were right. It would be great if Malaysians have that much disposal income

But according to BNM, 3 out of every 4 Malaysians do not believe they are able to put together RM1,000 if they had an unexpected emergency. Based on this report from BNM, I am not sure that the average Malaysian has as much as that. And based on our own customers, the average gold holding is much lower than RM1600 per customer

When you buy a 1 gram coin, you will find that the premium that you pay over the prevailing spot price far exceeds our fees. Typically this premium is between 20% to 50% over the prevailing spot price. With HelloGold, we buy 1 kg bars and we enable our customers to buy fractions of the bar for as low as RM1 a time.

I would encourage you to read our FAQs on how we store our gold and the transparency that we provide - https://help.hellogold.com/en/how-do-i-know...stored-is-safe/

We are hoping to announce in the next week two new investors - one is one of South East Asia's largest banks and the other is an investment fund of a South East Asian government

We have video tutorials on YouTube as well as an extensive set of Q&As on our FAQ website - https://help.hellogold.com/en/

If you have any specific questions, please ask it here and I would be more than happy to answer them

Robin

The process works as follows: we buy back the 1g from you at the prevailing price - the 2% fee. we then quote you the prevailing price for a 1g PAMP bar which will include the courier, insurance, packaging costs from Singapore

Our business is focused on helping individual save with gold. It is similar to GLD which I am sure you are familiar with - but at significantly lower transaction size. We enable customers to save with gold with as little as RM1. Customers can also transfer their gold at no cost to other HelloGold customers. And before the end of September, Aeon Malaysia will be launching with us a loan product that will enable our customers to use their gold as collateral for personal loans at significantly below market rates. We believe that these product features are and will be attractive to many people because they do not require to hold the gold physically. As the CFO of the world's largest gold fund, I can tell you that professional institutional investors tend not to hold physical.

That said, for people who simply want to hold and keep physical gold in their house, there are many different ways to buy the gold coins/bars as you have pointed out. You can buy bars from jewellers, banks, online dealers.

Robin

I can now also announce that Finlab in Singapore is one of our investors. The Finlab is a joint venture between United Overseas Bank and a Singapore technology agency, SGInnovate

https://e27.co/8-companies-get-ready-singap...ohort-20170614/

This post has been edited by robincflee: Jun 15 2017, 01:01 PM

For many people in emerging markets, they only have access to cash deposits that 1) return zero or very low interest and 2) keeps them exposed to local currency risk. This market do not typically have the ability to access fixed income or money market funds. We believe that gold can help them save better and, through our lending product, get access to more affordable loan products.

HelloGold enables them to start saving from as low as RM1. So for customers who can not afford to buy a whole coin, they can start buying gold for any amount that they can afford until they achieve the right weightage. They can then choose to redeem the physical gold bar at that point or they can continue to save through the 1kg bar. It is a choice that they can make.

Moreover, if they were to buy, say 1g of gold trading at a spot price of say RM170, the cost from HelloGold is RM170 + 2%. The physical coin premium, as I had mentioned earlier, would be anything between 20% to 50%. With HelloGold, if they want to sell their gold, they can do online through the app anytime from anywhere and get the prevailing price - 2%. If they had the physical gold, they would have to take it back or mail to back to the shop and the trade-in price would typically be lower than the 2% spread that we charge.

We offer a more convenient way of accessing a gold savings product than buying and holding a physical coin because it has a lower spread and you can buy and sell anytime.

If our customers want to take delivery of the physical gold bar, they simply have to call us up to arrange delivery. Based on the feedback that we have gotten from our customers who have enquired about physical redemption, the costs are in line with the market.

you are partly right and partly wrong

1) most banks do not offer their product on a mobile phone or 24/7 whereas HelloGold is mobile and 24/7
2) their gold product is typically not shariah compliant because the banking gold product is typically unallocated whereas HelloGold's gold is allocated gold
3) their gold product is not insured whereas HelloGold's is fully insured
4) it is not true that banks don't charge a fee. some banks charge an annual management fee. For example, UOB charges an administrative fee of RM2.12 per month if the balance of the account falls below 10gm at month end. so if you have only 1g of gold worth RM170, your annual fee will be RM2.12 per month or RM25.44 per annum which is equivalent to 14.96% annual fee - http://www1.uob.com.my/business/GMIM/GMIM_pga.html
5) it is hard to compare physical withdrawal prices because they are on prevailing rates. but the principle that is adopted tends to be the same e.g. the differential between physical gold price and the cost of the coin + processing fee
6) you can transfer the gold to another person with HelloGold. Banks do not provide this feature
7) you will be able to collateralise the gold against a loan - we are working on this with Aeon Credit. Banks do not provide this feature

HelloGold currently does not buy back gold for two reasons. 1) we are not able to verify the integrity of the gold bar after it leaves our control and the control of our vaulting agent as we do not have assaying facilities at this point. 2) our business is able to offer our customers a narrow spread because we hold 1kg bars and not smaller bars - if we hold bars of smaller weightage, it would increase our costs and we would have to pass that onto our customers. That said, we intend to work with one of our partners next year on the feasibility of creating a retail physical gold product. If we proceed to offer that product, a buy-back provision will likely be offered.

In terms of the KFH product, there are a number of differences

gold - we use 999.9 finest gold which is the highest grade commercially available and this gold is fully allocated. KFH offers 995 gold which is lower grade and less valuable and it does not necessarily have fully allocated gold. This is important because allocated gold means that the gold belongs to you. whereas unallocated gold means that KFH is a debtor and owes you the gold as its creditor.

price - we provide the latest prices to our customers through our app. and as of now our prices (inclusive of our buy/sell fees) are better - our current buy price is RM176.09 whereas KFH is RM176.34 per gram. Our current sell price is RM169.17 whereas KFH's is RM168.20 per gram

transaction size - our minimum transaction size is RM1 for any buy or sell. KFH has an initial minimum of 10gm which is RM1763 and subsequent minimum purchases of 1g which is RM176.30

minimum balance - our customers can have a zero balance with us. KFH requires a minimum balance of 2g which is RM352.68

management fee - we charge 2% per annum to cover the costs such as insurance, vaulting and auditing of the gold. KFH does not charge for the gold account because it does not provide insurance and audit of the gold

statement - we update our customer holdings constantly through our app with the latest value of the gold based on the sell price. KFH only provides monthly statements

cash payment - our customers can bank their cash into their HelloGold account from any bank. KFH requires customers to open a KFH savings or current account

physical gold redemption - we enable our customers to redeem the physical gold and it is delivered to them but we charge for the gold coin premium differential, delivery and insurance. KFH offers physical redemption at the branch but i can't find out if they charge you for the gold coin premium differential

buy-back - we currently do not offer buy-back provision. KFH offers a buy back option provided that 1) the packaging and security seal of the physical gold remains intact; and 2) t The serial number and the barcode printed on the face of the packaging of the physical gold matches KFH Malaysia’s records

audit - our gold is audited twice a year by an independent precious metal audit firm. KFH does not offer any audit service to assure customers that the gold exists

daily reconciliation - our gold undergoes a daily audit of our customer and bar lists against the records of our vaulting agent. KFH does not provide details of the gold that it holds for its customers

insurance - our gold is fully insured. KFH does not have any insurance to cover its gold

gifting - our customers can gift gold to any customer in any denomination to 0.1 grams. KFH offers a similar gifting product for 1g and 2g

I hope this helps

robin

This post has been edited by robincflee: Jun 22 2017, 02:58 PM

We are not a bullion shop. Our main business model is to provide a gold accumulation product, a collateralised lending product through our partner, Aeon Credit, and a gifting service. The physical redemption feature is not core to our business model unlike traditional bullion shops but we offer with support from our vaulting agent.

We take delivery of 1kg PAMP bars which are audited every six months by the Inspectorate. For those familiar with international best practice, you will appreciate that the biggest gold fund in the world also use the Inspectorate to give assurance on the gold that they hold on behalf of their clients.

Our investors include Finlab which is JV fund between UOB, the Singaporean bank, and SGInnovate, a wholly-owned Singapore government fund. Our marketing partner is Aeon Credit Services Bhd, a listed company in Malaysia. Our auditors are Deloitte Malaysia. Our lawyers are Zaid Ibrahim.

This post has been edited by robincflee: Jun 22 2017, 03:17 PM

I don't think a Singapore government fund would invest in a business that it is uncomfortable with. I would encourage you to check the Finlab website if you want to verify their investment.

Say you have 10g of gold and you want to redeem the gold, you call our service centre and we quote you the price for converting the 10g fractional ownership of gold in the 1kg bar into a 10g bar. If you decide that you want to proceed, we buy back the 10g of gold from you at the prevailing price and add on the required premium for buying a 10g bar. We then place the order for the 10g bar and have it delivered to you. You can check the authenticity of the bar through the PAMP app that can be downloaded separately and managed by PAMP.

In terms of our fees, in response to another post, I did a quick check another local bullion provider and we are competitive

With regards to our loan product which we hope to launch by Q3, I think you will find that will be market beating in terms of its fee structure. But we are not able to release further information about the loan details at this point.

As I had explained in the earlier posts, we use established principles for managing our customers gold based on what is done for GLD which I am sure is a product that you are familiar with.

With regards to buy-back, I have also explained why we currently don't offer that service. In addition, our customers have not typically required physical redemption of their gold and therefore the additional cost of provinding that service does not make commercial sense for us at this point.

Last but not least, no one should save gold with any business that they are not comfortable with - whether it is ours or anyone else's. They should have complete confidence in the platform because they are relying on it to provide the services that are promised.

As an aside, Enron's auditor was Arthur Andersen