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Stephen flood

Stephen Flood and his business partner Mark O’Bryne have quietly and quickly become among the top gold traders and investors in the world.

“From very humble beginnings we started to grow a nice client list. We have had a very fortunate time riding this gold bullion wave since it began to appear on people’s radar when gold was at a mere $350 and now it is at $1,000.”

Gold and Silver Investments was set up in Dublin in 2003 and Flood became a 50 per cent stakeholder and director a year later.

Five years on, Flood says: “We have a staff of 11, are cashflow-positive and have no debt.”

Gold and Silver Investments allows people to invest in and buy gold, silver and platinum either through bullion coins and bars, or through the Perth mint storage programme.

“It is the world’s only government-backed certificate programme for gold. They produce bullion coins and also allow investors to buy title to the bullion in their vault.

“By doing that, investors can own X amount of ounces of gold, silver or platinum and they receive a certificate which has the name of the Western Australia Perth Mint and the name of the client as beneficiary, so there is no middleman.

“That is very important because there is no counterpart risk and that is what you want. When you buy gold you are making a statement that you believe in systemic risk and one of the biggest components of systemic risk is counterpart risk so if you do not have a reliance on any private third party then that is a major bonus.

“The second major factor is there are no ongoing storage charges so if you bought 50 ounces today for your family investments, you could sell them in 20 years time and you would still have the 50 ounces to sell. Other products, like ETFs, will charge you management fees every year, which are the lion’s share of the costs.”

Raised in Dublin, Flood went into business at an early age, employing friends to hawk packets of greeting cards he had bought for £1 to sell at £2.50 on the local estate “but one night they all got quite disgruntled and quit altogether”.

Undeterred, Flood says: “I was caught by the allure of Wall Street. I had my visa so I went over to New York on an expeditionary trip just to check it out when I was 23. I had no contacts so I picked up a New York Times looking for brokerage jobs and there were tons of jobs advertised. I found myself highly employable. I did not check how much I was being paid, I did not care, all I knew was that I was in the door.”

But he adds: “My first job basically turned out to be a boiler room operation. Teenage people phoning up prospective clients and selling one or two really small companies as if they were worth a fortune. It was pump and dump. I did not know any of this but after two days I thought something’s not right, I have got to get out of here so I quit and joined Bankers Trust.”

At Bankers Trust, a good technology education in Ireland put him in good stead and after a stint in the front office working on Latin American markets, which he describes as “like the Wild West of finance”, he got a job at Goldman Sachs.

“After about nine months, I was promoted to the portfolio trading desk, or program trading, within equity derivatives department. I was trading on probably one of the most powerful desks in the company in one of the most powerful companies in the world.”

But he says after seven years and being newly married, he found the appeal of New York waning. “I had hit the mark where I wanted to be and got the experience I wanted. I wanted to move back to Ireland. I came from a family of five kids and wanted to have kids myself. There is a major quality of life issue in New York and Ireland offers a much better work-life balance.”

Back in Ireland, Flood says his experience has proved to be “a goldmine”. Although the market has recently taken a slight downturn, Flood believes the outlook is still positive for investors.

“The ratio is still very much in favour of the buyer. There is probably about three buyers to one seller. A rule of thumb for gold investment is around 5-10 per cent of a portfolio. You are trying to do is reduce the volatility and maintain performance. Gold has been proven time and time again to be non-correlated.”

Flood also tips silver to do well. “We are very bullish about silver and we believe in the next few years that it could even surpass gold. We always say that a nice allocation for a lump sum would be 75 per cent gold, 25 per cent silver.”

Flood has great ambitions for Gold and Silver Investments with imminent plans to bring the wealth management service to the UK and hopes to open offices in Germany and Hong Kong. “If you bring a European mindset with a global outlook, we think it will do very well over there.”

Born: 1973

Lives: Dublin three weeks a month, London one week a month

Education: Financial diploma, Fitzwilliam Institute, Dublin; BA Hons business studies, Portobello Business College, Dublin

Career: September 2004-present: director, Gold and Silver Investments, Dublin; Other jobs included sales trader, Goldman Sachs, New York; assistant vice-president, formerly Bankers Trust Company, New York

Likes: I love to travel off the beaten track in wild countryside and explore indigenous cultures I love sailing, scuba diving, squash, hiking, snowboarding (I am awful). I like photography, music and movies. I love applied economics and exploring how markets operate, how they affect real people and their businesses. I like current affairs and reading Newspapers. I like being a father to my three sons, Sean, four years old, Liam, two and a half, and Tadhg, 10 months. I enjoy my job and working with the team at Gold and Silver Investments. I like gold.

Dislikes: Dishonesty, laziness, apathy, corruption.

Drives: Renault Espace

Book: Jack: Straight from the Gut by Jack Welch

Film: Star Wars

Album: Eyes Open by Snow Patrol

Career ambition: To grow our company into a world leader in client-centric financial innovation.

Life ambition: To never stop wondering. To make a difference

If I wasn’t doing this I would be… Crazy… just kidding, I suppose I would have become a pilot or a Formula One driver or something, hard question


World view

It would seem that the expanding fund universe should offer plenty of choice for advisers. However, the fund universe isn’t really growing, at least not as much as one would expect, considering that there have been nearly 500 launches in the past five years. Numerous closures have kept the overall number of funds fairly consistent for much of the past decade.

A shaw thing

Annie Shaw is a freelance financial journalist
To the Chelsea Flower Show as a guest of HBOS, where the flowers were fab and I met Jamie Oliver – no, not that one. The one enjoying Halifax’s hospitality is the author of sundry books about death and sex (separate titles) and also writes about entrepreneurs and other financial things for the Daily Telegraph.


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