The Investor Protection Saba Would Remove
ASA shareholders are protected from profit-sharing fees. Saba’s BDC proposal would remove that protection.
ASA is currently regulated as an investment company under the Investment Company Act of 1940. Under that framework, investment companies are prohibited from charging performance fees, except under very limited circumstances.
Saba’s proposal would change that.
Saba is proposing that the Board it hand-picked repurpose ASA into a Saba-managed BDC-style vehicle. Business Development Companies are also partially regulated under the 1940 Act, but they are exempt from the prohibition on charging performance fees.
In plain English: Saba is proposing to move ASA from a structure that protects shareholders from profit-sharing fees into one that would allow Saba to collect them.
That is a fundamental change. ASA shareholders invested in a precious metals mining fund, not a vehicle designed to generate management and profit-sharing fees for Saba.
This is the investor protection at issue: under ASA’s current structure, Saba could not simply charge shareholders a profit-sharing fee. Under the proposed BDC-style structure, it could.
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* The online registration is to indicate potential interest only. More information about a potential Merk-managed mining strategy will be provided at a later date. The past performance of ASA does not guarantee the future results of another Merk-managed strategy.
As of this writing, ASA’s Board has not announced how it will proceed. On June 30, 2026, Merk concluded its management of ASA after the Saba-controlled Board terminated Merk’s advisory agreement. Certain Fund directors, including a Saba partner, have assumed responsibility for ASA’s management.
Axel Merk owns over 300,000 shares of ASA Gold and Precious Metals Limited. He serves as President and Chief Investment Officer of Merk Investments LLC, which served as the Fund’s investment adviser until June 30, 2026. He also resigned as Chief Operating Officer of ASA in June 2026.
Nothing on this website constitutes an offer to sell, or a solicitation of an offer to buy, any securities. 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. (“ASA” or the “Fund”). 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. ASA 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, assumptions, 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 including the negatives thereof, other variations or comparable terms. These statements speak only as of the date made, and there is no obligation to update or revise them in light of future developments.
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