Anyone buying GOLD or GOLD miners

[moneymaker]

If anyone lives by the motto of buying when everyone is scared, isn't now a good time to buy Gold or Gold miners (GDX/GDXJ)?

It's been slaughtered since 2011. Eventually, there can be A LOT of money made here. I can see folks that are already retired not wanting to wait, but what about for the folks that have 10+ years to retire.

Thoughts?

 

[Big_Hitter]

I have enough hard metal. I am thinking about reallocating some cash into a gold fund, like tgldx.

 

[VFK57]

I have some PMs and so far it is all in the red. Yet the price of physical Gold, Silver and especially Platinum is lowest in years. PMs is not investment and I keep it only as insurance against hyper inflation. Some economists disagree it is needed while others advise to keep about 5 - 10% of your assets in Gold/Silver, you decide for yourself. I know a few people who had seen hyper inflation in Ukraine, Georgia and Russia during USSR collapse (1990s). They told me that only currency to purchase food or services at that time was Gold or jewelries. I do not think we are going to see anything like that but large inflation is possible and happened in the past.

 

[heeyy_joe]

Platinum is ridiculously oversold.

 

[Sunset]

I don't have any gold, besides what is in my mouth.

I would think silver is better than gold, as last I heard silver had dropped a larger % than gold and silver actually has a use which equals demand by industry.

Most allocation commonly touted is up to 5%.
During times of hyper inflation, besides the fact that you can see it starting unlike an asteroid, is that various things can be traded for services/goods besides gold. Example booze, food, other services.

 

[DrRoy]

I own a bit of gold as part of my coin collection, and so have tended to watch the price over time. Silver too. However, I do not have the same sense of comfort with gold or miners as an investment that I do with stocks, bonds, etc. For the latter, I feel that I understand the underlying fundamentals of the supply and demand. For gold, though, it just seems like a total crapshoot. The demand seems to bounce all over the placed with much less logic to it. Yes, gold is down a lot from the high, and some day it will bottom and make someone some money. But you could have said that two years ago with the price down around 30% from the high, trading at $1250/oz. Now it is ~13% lower. What keeps it from continuing to fall? Also, there is not even a return for holding it, like a dividend. I'm just not into raw gambling.

 

[jim584672]

The gold chart looks very weak. Think the deflationary wave has it in its grips.

 

[Car-Guy]

My first stock purchase was in a gold mining stock. That was back in the days (pre 75 brokerage deregulation) that the brokers fee (Merrill Lynch) was almost as much as a 300 shares of the mining stock I bought. Even at that I made money on the gamble. I now look back on that and laugh.

These days I have no gold mining stocks and only a few gold coins.

Personally, If I were to get serious about any PM's, I'd be buying silver and not gold or platinum. Although, the problem I see with silver, in the quantities I'd want, is where to store it. Just $100,000 in silver would be about 450 pounds at today's spot prices. That starts getting pretty heavy and takes up a lot of room.

 

[VFK57]

Gold price @$1,088(pick price was $1,900+) per 1Oz is ahead of Platinum $820 per 1Oz (pick price was $2,100) and Platinum is far rarer metal than Gold. I think that many Central Banks still have interest in Gold assets because nobody knows where monetary policies around the world would lead to. Silver has also dropped from pick of about $45 to $14 per 1Oz currently.

 

[stepford]

I bought about a cheap sportscar's worth of gold when it was $800-900/oz, rode it up to where it was worth a couple of cheap sportscars or one nice one... and then back down to where (accounting for inflation) it's worth about 1 cheap car again. You know what they say about pigs getting slaughtered - I guess that's me. Anyway it's maybe 1% of my NW, so just play money, but I'm not in any hurry to add to my allocation.

 

[sengsational]

When the market zigs, gold is supposed to zag, but that doesn't hold water. I'm not sure what that says about equities valuations or gold valuations, but I've always kind of hoped I'd have at least something to brag about when equities went down since I have a (tiny) gold allocation, but I'm always disappointed.

 

[harley]

I've been considering a small investment in Patron Gold. Problem is, every time I buy it it goes right down.

 

[traineeinvestor]

I've been considering a small investment in Patron Gold. Problem is, every time I buy it it goes right down.

Please let us know next time you are buying so we can go short.

As I look back over my investing lifetime (30+ years) gold (and resources generally) has been the worst asset class to be in - it provides no income, has probably not kept up with official CPI numbers (a bit higher than the US were I live), has not provided any diversification benefit and has under performed just about every other asset class I could sensibly invest in. The insurance argument has looked increasingly meaningless for those who live in developed countries. In spite of which, I am still clinging to a tiny allocation to gold and a very small allocation to silver and am not sure why I should keep it.

 

[harley]

 

[ejman]

I've only lost money in 2 investments that I've held for a 15+ year period. Gold and silver. (early 80's to mid 90's) That kind of cured me of those 2. And that's loosing money in nominal terms, not adjusted for inflation. And on top of that, no dividends and it cost money just for safekeeping each year.

 

[sengsational]

Based on all the negative comments in this thread, I'd say gold would be a great investment about now.

 

[haha]

Please let us know next time you are buying so we can go short.

As I look back over my investing lifetime (30+ years) gold (and resources generally) has been the worst asset class to be in - it provides no income, has probably not kept up with official CPI numbers (a bit higher than the US were I live), has not provided any diversification benefit and has under performed just about every other asset class I could sensibly invest in. The insurance argument has looked increasingly meaningless for those who live in developed countries. In spite of which, I am still clinging to a tiny allocation to gold and a very small allocation to silver and am not sure why I should keep it.

Me neither. Sell!

Ha

 

[ejman]

Based on all the negative comments in this thread, I'd say gold would be a great investment about now.

Maybe. You go first.

 

[Options]

Sheepishly admitting I bought about $20K in coins some years ago. They've been collecting dust for years. Would never do it again. If only...

 

[34rlsa]

I drank the koolaid a few years ago

Have about a 3% allocation in GLD.

I'm not adding now and have no plans to add in the future.

I don't even include it when calculating net worth.

 

[OrcasIslandBound]

My DW invested a chunk in mining and gold stocks a couple years ago. Got her butt kicked, won't do that again. Probably an ok time to invest now, but keep it to a really small amount. Some of these firms have been declining steadily for 8-10 years now.

Sent from my Nexus 4 using Early Retirement Forum mobile app

 

[VFK57]

Gold is the worst investment in comparison with stocks, bonds, CD or most other assets. However the Financial cataclysms and hyper inflation happens and USD is not immune to it. Therefor I think that keeping small amount of your assets in Gold is like keeping a small insurance policy just in case.

 

[VFK57]

Interesting Info: Comex indicates 73% drop of physical Gold in their vaults. In comparison with August 2015 it states reduction in physical Gold is 8 times. They also state that only 1 in 542 future contracts are guaranteed with actual physical Gold delivery.

 

[redduck]

... Although, the problem I see with silver, in the quantities I'd want, is where to store it. Just $100,000 in silver would be about 450 pounds at today's spot prices. That starts getting pretty heavy and takes up a lot of room.

If you like, we could store it in my garage.

 

[SoReady]

Since this thread started back in Jan it seems the OP (Moneymaker) may have been asking a good question at the right time. Gold (and silver) have made a significant run this year.

I have considered having a small percentage of a gold fund (SGOL) be as part of my asset allocation to buffer against a major downturn. Currently, I have none and sit at 40% bond funds - 60% stock funds. I am thinking the 3-5% range coming from the stock fund allocation.

BUT the big question/concern I have is if now is a good time or not. I would see this allocation staying in place for at least 10 years. So as the OP stated in the subject line: Anyone buy gold right now?