Anyone buying GOLD or GOLD miners

Bought some IAU

Bought some IAU...already a good run, but I expect a lot more...small part of the portfolio....
 
SoReady said:
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?
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Yep, I was VERY wrong.... darn....
But now.. I don't see how GDXJ can go up much more, since it about doubled from when I started watching it.. :facepalm:
 
Several gold mining stocks are up over 100% this year. I've always held some, and realized LOTS of losses as I switched among them over the last couple years. Even with the recent run, only 5-6% of my port.

Hanging on for now. Don't want to pay the short term cap gains, and frankly, I don't know where I'd go with the $.
 
Warren Buffett cured me of any desire to own gold after I read this quote of his, "Gold gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head."
 
I purchased a small position in a gold mining etf (GDX) in early March based on the recommendation of a momentum following newsletter which I follow. It is up 31% to date. I’m hanging on to it until I get a sell signal.
 
Finally got out of my gold coins very close to $1300. It will be interesting to see how long that money, once invested, takes to recover my losses...
 
moneymaker said:
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)?
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Who is 'scared' re: gold?

traineeinvestor said:
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.
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ejman said:
I've only lost money in 2 investments that I've held for a 15+ year period. Gold and silver.
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sengsational said:
Based on all the negative comments in this thread, I'd say gold would be a great investment about now.
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Those are some pretty long-term negative assessments. I'm not sure how well that would translate into any sort of a timing indicator... :blush:
 
Not sure about gold itself, but gee the gold mining company bonds have been paying off nicely. My May 1 payment on the bonds I bought at a 62% interest rate are enough to buy quite a few gold coins.

I guess Buffett was wrong. Gold can make baby gold.

Or maybe I am selling shovels and boots to the miners like the days of old.
 
I bought GLD in early '07 in DW's rollover, fearing a crash, then sold in '09 and '10 for almost an 80% profit, wanting to purchase stocks in her account.
My main account was holding cash (twice the allocation), so I placed the equivalent of DW's GLD in FSAGX (Fidelity Gold Mining fund) and eventually doubled the amount over the next two years, since the ostensible allocation was about 5% in commodities (half in PMs); the thesis was that the miners generally move 2-4x the gold price, so FSAGX was leveraged PM.
The miner fund went up for a year or two, then started sinking in 2013 and 14, about 55% down, when I took some stock gains and added another 25% position, then it sank another 17% in '15.
Now it's up almost 75% YTD, and I'm about even since 2006, if you factor in the original position in GLD. I considered putting a little more in in January, but since I was down about 1% in the total portfolio in 2015, I didn't have a lot of gains to take, other than some bonds I wanted to keep.

So the miners are uncorrelated, but a wild, wild ride. GLD or SLV are similar but not quite as exaggerated.
Take of this what you will. It's a small percentage of the portfolio, which raises the question whether it's even worth bothering.

On the other hand, right now it is a sizable percentage of the ytd portfolio gains, which is similar to my experience with biotech and health, although I overweighted them at a considerably higher weight than FSAGX but thankfully harvested gains from 2012-early 2015, to the point that the gains in shares sold are almost 2x the current position. Should the FSAGX run continue through the year, I'll probably take 20-25% off the table.
 
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Majority of Early Retirees here do not like Gold for obvious reasons. However if you are going to take a look at Gold price vs $US strength, you will find a direct relation (like shadowy Gold standard). The GDP#1 is the European Union currently so let's take a look on Dollar vs euro vs Gold prices. In 2011 we had 1 Euro = 1.45 $US or weak dollar, the 1 Oz Gold was at $1,900. Then in Nov 2015 the exchange rate was 1 Euro for $1.07, much stronger dollar vs $1,068 per 1 Oz Gold. If you are afraid of sharp dollar decline, it worth to keep physical Gold, possibly Gold Mining stocks. Most funds like GLD do not have adequate physical Gold supply to cover all their customers stocks holdings (only very large stock holders can get physical Gold in exchange for shares). Why dollar could decline is because weaker dollar attracts more production, stronger dollar causes production shift to countries with weaker currencies. It is regulated by the Feds here but other counties understand it as well and manipulate their currencies in order to gain an advantage in trade: US places 5 countries on trade monitoring list - Business Insider
 
I am a bit over 5% in gold at the moment, not buying more but not planning to re-balance lower either. It has been a good performer for me, purely because of lucky buy timing near the multi-year bottom.

Mostly, I consider it a hedge (insurance) against things like a falling USD as mentioned by VFK57. And, I have no interest in being over-insured.
 
VFK57 said:
...Most funds like GLD do not have adequate physical Gold supply to cover all their customers stocks holdings (only very large stock holders can get physical Gold in exchange for shares)....http://www.businessinsider.com/ap-us-places-5-countries-on-trade-monitoring-list-2016-4
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I don't think this is true. Only creation / redemption units of 100,000 shares can be added or withdrawn from the trust. This is how ETFs work. It does not mean gold certificates do not back the trust.
 
jim584672 said:
I don't think this is true. Only creation / redemption units of 100,000 shares can be added or withdrawn from the trust. This is how ETFs work. It does not mean gold certificates do not back the trust.
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You are correct. Yet I had only about 250 shares and got advise from one of my friends that if I want to sell the GLD, I would get only dollars not physical Gold despite the advertisement that it is fully backed by physical Gold. Whem I contacted them I got same reply that in order to get actual Gold I have to have over 100,000 shares (at the time I sold it the cost of 100,000 was over $13,000,000).
 
VFK57 said:
Majority of Early Retirees here do not like Gold for obvious reasons.
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I clearly don't know what the obvious reasons the majority of ER's don't like Au are since I'm in at 9% with no plans to reduce.
 
Fermion said:
Or maybe I am selling shovels and boots to the miners like the days of old.
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Pretty sure Buffett indeed referred to the physical gold.

Gold itself doesn't make sense to him (and me). You dig it up, move it someplace and pay people to stand around it. (paraphrasing here). It doesn't produce anything.

Could be worse though, like diamonds ..
 
ESRwannabe said:
I would consider buying the gold/silver ETN's that sell covered calls. You'd have an income stream that way.

Credit Suisse X-Links Gold Cov Call ETN (GLDI)

GLDI Credit Suisse X-Links Gold Cov Call ETN ETF GLDI Quote Price News

Credit Suisse X-Links Silver CovCall ETN (SLVO)

SLVO Credit Suisse X-Links Silver CovCall ETN ETF SLVO Quote Price News

Pretty good yields on them and you get to own gold/silver for your asset allocation.
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How does a cover call fund work? This looks interesting, but I would need to investigate/understand it more before committing any funds.
 
Totoro said:
Pretty sure Buffett indeed referred to the physical gold.

Gold itself doesn't make sense to him (and me). You dig it up, move it someplace and pay people to stand around it. (paraphrasing here). It doesn't produce anything.
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I don't see holding US$ or putting it in a low-paying account as better. Au is just another type of cash to me that protects against fiat currency inflation. Ultimately, I can't see that not happening with the budget imbalances. I'm quite willing to risk I'm wrong.
 
My only problem with gold is that people think it's special. It isn't. Like everything else, it is only worth what someone pays for it. It's a relatively useless metal, but for some reason it gets outsize attention and thus is prone to huge swings in value based on people's feelings and emotions.
 
nash031 said:
My only problem with gold is that people think it's special. It isn't. Like everything else, it is only worth what someone pays for it. It's a relatively useless metal, but for some reason it gets outsize attention and thus is prone to huge swings in value based on people's feelings and emotions.
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You should check major economies Gold reserves (USA, Germany, France, Italy, Japan, China etc), none of them sold or planning to sell their physical Gold holdings. There are two desperately needing cash countries (Venezuela and Ukraine) which sold their Gold last year in order to pay for needed imports. China continues to grow their Gold reserve. If Gold is not "special" hard currency then why Central Banks do not dispose of it?
 
nash031 said:
My only problem with gold is that people think it's special. It isn't. Like everything else, it is only worth what someone pays for it. It's a relatively useless metal, but for some reason it gets outsize attention and thus is prone to huge swings in value based on people's feelings and emotions.
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For 5000+ years people have thought Au special. Perhaps that will change tomorrow. I guess it's the shine + color. I don't know anyone wearing US$ on the fingers.
 
VFK57 said:
You should check major economies Gold reserves (USA, Germany, France, Italy, Japan, China etc), none of them sold or planning to sell their physical Gold holdings. There are two desperately needing cash countries (Venezuela and Ukraine) which sold their Gold last year in order to pay for needed imports. China continues to grow their Gold reserve. If Gold is not "special" hard currency then why Central Banks do not dispose of it?
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As an investor, it is not special. In fact, I say it is less special. I cannot look at gold and see its intrinsic value, determine when it is undervalued and overvalued and make decisions on whether to buy or sell based on that value. The price of gold is tied strictly to the emotions behind it, as well as the emotions seen in markets world wide, and in some small measure to its availability... but primarily, its price (and value) are driven by emotion. Thus, I cannot accurately predict its value other than to try to guess the appetite of the world in the near future for gold. That strikes me as speculative market timing, which is not for me.

I can achieve similar returns via other means. I understand others hold it as a hedge against oblivion and market crashes.

You're hooked, I got it. Not for me, thanks.
 
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nash031 said:
As an investor, it is not special. In fact, I say it is less special. I cannot look at gold and see its intrinsic value, determine when it is undervalued and overvalued and make decisions on whether to buy or sell based on that value. The price of gold is tied strictly to the emotions behind it, as well as the emotions seen in markets world wide, and in some small measure to its availability... but primarily, its price (and value) are driven by emotion. Thus, I cannot accurately predict its value other than to try to guess the appetite of the world in the near future for gold. That strikes me as speculative market timing, which is not for me.

I can achieve similar returns via other means. I understand others hold it as a hedge against oblivion and market crashes.

You're hooked, I got it. Not for me, thanks.
Click to expand...
I can't predict the future value of anything. Good for you that you can. Equity prices are often driven by emotion, not intrinsic value. Net, Au is just something else I can't predict. I'm far from hooked. I just want to spread my chances around widely. Can't see the market timing aspect to it if you buy & hold.
 
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