Portfolio Risk
Outperformance driven by process, not leverage or excess risk-taking
Prudently Managed Portfolio Risk
Precious metals investing is naturally volatile. Merk's objective is not to eliminate risk, but to manage it within a disciplined framework. ASA’s outperformance was not achieved through excessive leverage or reckless positioning, and independent analysis confirms that returns remained strong after adjusting for risk.
Merk's investment approach combines disciplined security selection, active portfolio construction, and continuous risk oversight designed to manage volatility while maintaining meaningful exposure to the precious metals sector.
At the portfolio level, risk is actively managed through:
- Moderate commodity exposure (portfolio beta to gold ~1.1)
- Returns not driven solely by gold
- Disciplined portfolio construction
- Continuous risk oversight
- No structural leverage
ASA is expected to exhibit volatility consistent with the precious metals sector. The relevant question is whether that volatility is managed responsibly. Merk's portfolio construction emphasizes liquidity, diversification, and company-specific opportunities rather than excessive leverage or purely high-beta exposure.
During recent market volatility, ASA’s risk profile remained consistent with peers while performance compared favorably.
Return / Risk Ratios
ASA’s return-to-risk profile compares favorably to peers and benchmarks, with leading return-to-risk and downside risk metrics.
1 year return-risk ratios through May 31, 2026:
1 year return versus downside risk:
ASA’s performance reflects a disciplined, risk-aware investment process that depends on the portfolio management team’s ability to execute consistently and without disruption.
Assertions of excessive risk-taking are not supported by the Fund’s observed risk profile or independent analysis.
Independent risk analysis conducted by Broadridge.
Saba is proposing to the Board that it hand-picked to repurpose ASA into a Saba-managed BDC-style investment vehicle with management fees and profit-sharing arrangements. File a complaint with the SEC to help protect ASA shareholders. As of this writing, ASA’s Board has not announced how it will proceed. The advisory agreement expires June 30. Shareholders need to act now.
Axel Merk owns over 300,000 shares of ASA Gold and Precious Metals Limited. He also serves as President and Chief Investment Officer of Merk Investments LLC, the Fund's investment adviser. He recently resigned as Chief Operating Officer of ASA.
The information presented on this website reflects the views and opinions of Axel Merk and is provided solely for educational and informational purposes. It does not constitute investment, legal, financial, or tax advice. You should consult your own advisors for guidance specific to your circumstances.
The plans of Saba and the Board are based on publicly disclosed information only and are therefore accordingly qualified in their entirety and subject to change.
This site and its content have not been approved by ASA Gold & Precious Metals Ltd. (the “Company”). The Company concentrates its investments in the gold and precious minerals sector, which may be more volatile than other industries and influenced by changes in commodity prices driven by international economic and political developments. The Company is a non-diversified fund, which may result in higher risk through reduced portfolio diversification. It may also invest in smaller-sized and foreign companies, which may be more volatile, less liquid, and subject to additional risks, including currency fluctuations. Shares of closed-end funds like ASA frequently trade at a discount to net asset value.
This website may include forward-looking statements that reflect the current expectations, estimates, beliefs, and projections of Axel Merk. These statements are inherently subject to risks and uncertainties, many of which are beyond the control of the author. Actual outcomes may differ materially from those discussed. Forward-looking statements can often be identified by words such as “believe,” “expect,” “intend,” “may,” “will,” “should,” or similar expressions. These statements speak only as of the date made, and there is no obligation to update or revise them in light of future developments.
Nothing on this website constitutes an offer to sell, or a solicitation of an offer to buy, any securities.
Certain links may direct users to third-party websites or filings with the U.S. Securities and Exchange Commission (SEC). These materials are provided solely for convenience and informational purposes and are not incorporated by reference into any proxy materials. No responsibility is taken for the accuracy or content of third-party sources.
