Gold Rally Lifts Returns at Chinese Wealth Managers and Insurers

Gold prices have surged and then pulled back, with spot London gold at about $4,438 an ounce as of August 31, up nearly 10% for the month after touching a high of $4,697, according to Jiemian News. The rally has lifted the net asset values of several gold-enhanced wealth management products, while insurers have also been building exposure since China's insurance gold investment pilot began in early 2025. Jiemian News found that most gold-enhanced wealth products are R2 or R3 fixed-income-plus products that use equities or fund allocations rather than large direct gold positions. A bank wealth management subsidiary executive said such products typically keep gold commodity exposure at 2% to 5%. Minsheng Wealth Management's R2 fixed-income-plus product Minsheng Wealth Management Maozhu Gold Enhanced Half-Year Holding A returned 0.81% over the latest month through August 26, with its second-quarter report showing no commodity or financial derivatives exposure. Bohai Wealth Management's R3 fixed-income-plus product Wealth Art Fuyu Chiying 180-Day Minimum Holding Fixed Income Gold Enhanced Strategy No. 1 A returned 1.36% over the latest month, while its half-year report showed zero commodity and derivatives exposure, 4.83% in equities and 23.86% in public funds. Everbright Wealth Management's two R2 fixed-income-plus products, Sunshine Qingrui Yuelexiang 44th Period Gold Auto-Trigger Strategy Fixed Income A and Sunshine Qingrui Yuelexiang Zhenying No. 1 Gold Auto-Trigger Strategy Fixed Income C, returned 0.53% and 0.51% over the latest month. Wealth managers said gold is being treated as a strategic core holding for diversification and hedging against equity, FX and geopolitical risks. Yuan Yao, business director and head of multi-asset investment at China Merchants Wealth Management, said gold remains an indispensable part of multi-asset portfolios, especially as debt expansion and central bank buying support its long-term allocation value. Ping An Wealth Management said gold has held above $4,400 and may continue to rise in the near term, while ICBC Wealth Management said geopolitical conflict, de-dollarization and continued central bank purchases still support gold's monetary and safe-haven role. China's National Financial Regulatory Administration issued a notice in early 2025 allowing 10 pilot insurers to invest in gold for medium- to long-term asset allocation. The pilot insurers are PICC Property and Casualty, China Life, Taiping Life, China Export & Credit Insurance, Ping An Property & Casualty, Ping An Life, CPIC Property & Casualty, CPIC Life, Taikang Life and New China Life. China Pacific Insurance vice president Su Gang said the company is still in the early stage of building gold positions, while a Ping An Life executive said the insurer is actively advancing gold-related work. A senior asset-management executive at a major insurer said gold's low correlation with equities and bonds makes it useful for hedging and improving portfolio stability.