Good time to buy gold/gold ETF now - Nov., 2017?

[robnplunder]

I need to balance my portfolio a bit and am looking at investing in gold ETF for long term. What do others think about buying gold now?

 

[Dash man]

I’d avoid an ETF and only consider physical gold bullion if you do invest in gold. But I’d wait. I expect it to drop below $1200, then I’d buy. I do expect it to rise significantly in the long term, but not imminent.

 

[OldShooter]

I think it's a hilarious idea.

 

[gerntz]

I don't think it's all now or none. Why wouldn't one ease in over a few years, say every six months?

We own two Au ETF's in our assets. Have held for 10-12 years now.

 

[GrayHare]

Be aware that to fund their operation many precious metals funds sell a small amount of their holdings monthly. For income tax purposes these sales are passed to each fund holder to report on their tax returns. The data about these sales is not released until March or April, delaying tax filing. In addition you may find the necessary gain/loss calculations tedious, especially if you've bought into the fund on separate occasions.

 

[gerntz]

Be aware that to fund their operation many precious metals funds sell a small amount of their holdings monthly. For income tax purposes these sales are passed to each fund holder to report on their tax returns. The data about these sales is not released until March or April, delaying tax filing. In addition you may find the necessary gain/loss calculations tedious, especially if you've bought into the fund on separate occasions.

I've never run into this issue with my two Au ETF's.

 

[Starsky]

I need to balance my portfolio a bit and am looking at investing in gold ETF for long term. What do others think about buying gold now?

Gold ETFs are not a good long-term investment, but they can be useful under certain circumstances. Whenever you buy, Gold is always highly speculative and is not really an 'investment' in the traditional sense as much as it is a commodity. One of the problems with ETFs is that they usually hold futures contracts - orders for future Gold purchases - that would be impossible to fill in the event of a total market crash. Here's an article that explains it... There's no reason to own a gold ETF - Business Insider

Physical Gold (and precious metals and diamonds) is a traditional hedge against currency deflation and a physical storage of intrinsic value. (vs. the extrinsic value of currency). I consider it more of an insurance policy, that many will argue is of dubious value - until **** hits the fan. I didn't start to buy physical Gold and Silver until I felt we had enough other assets invested and working for us to be comfortable. It was one of the final pieces of our diversification/asset protection strategy in retirement - a decent portion of our savings account money that we didn't want to keep in the bank.

Many wealthy investors will keep a percentage of their assets in physical Gold and rebalance periodically. There are several different ways to do this, and it's worth doing some homework if you're interested. Here's a video of one famous investor you'll recognize and his strategy:

 

[gerntz]

Gold ETFs are not a good long-term investment, but they can be useful under certain circumstances. Whenever you buy, Gold is always highly speculative and is not really an 'investment' in the traditional sense as much as it is a commodity. One of the problems with ETFs is that they usually hold futures contracts - orders for future Gold purchases - that would be impossible to fill in the event of a total market crash. Here's an article that explains it... There's no reason to own a gold ETF - Business Insider

Physical Gold (and precious metals and diamonds) is a traditional hedge against currency deflation and a physical storage of intrinsic value. (vs. the extrinsic value of currency). I consider it more of an insurance policy, that many will argue is of dubious value - until **** hits the fan. I didn't start to buy physical Gold and Silver until I felt we had enough other assets invested and working for us to be comfortable. It was one of the final pieces of our diversification/asset protection strategy in retirement - a decent portion of our savings account money that we didn't want to keep in the bank.

Many wealthy investors will keep a percentage of their assets in physical Gold and rebalance periodically. There are several different ways to do this, and it's worth doing some homework if you're interested. Here's a video of one famous investor you'll recognize and his strategy:

That's a nice commercial for physical gold services.

 

[ziggy29]

IMO gold isn't really an investment but more of a hedge against inflation and rampant uncertainty in financial markets and political systems.

That said I have no problem with a small holding in gold, precious metals and other hard asset commodities, say up to 5% of a portfolio, provided one understands why they hold it and what role they expect it to play.

 

[Senator]

I have some GLD which is an ETF. Bought several years ago, it's still down over $2K.

Physical gold is not a good investment. You pay a high transaction/commission fee. You have to pay to store it, or keep it at your house. You pay a high commission.

If you are buying gold coins for more than the face value of gold bullion, you have to speculate that the next buyers want that same currency or imprinting.

If you are buying gold for the Apocalypse, guns and bullets are a better investment. If you are buying them as a hedge, an ETF works better.

 

[gerntz]

IMO gold isn't really an investment but more of a hedge against inflation and rampant uncertainty in financial markets and political systems.

That said I have no problem with a small holding in gold, precious metals and other hard asset commodities, say up to 5% of a portfolio, provided one understands why they hold it and what role they expect it to play.

I agree with this other than I don't consider Au a commodity since hardly any of it is consumed but rather held & recycled at 99%+. Its beauty gives it intrinsic value.

 

[VanWinkle]

To me Gold is a fear play, nothing more. If you want it to balance your portfolio when stocks are going down, there are much better ways to do it. If you think having physical gold will enable you to buy things in a changed world, go for it. Just don't call it an investment. It is speculation at best.

VW

 

[stephenson]

Gold is not a good investment - IMO. UNLESS huge market forces occur - which does happen

I did some numismatic "investing" about 20 years ago as my "hedge" ... not a good investment, but was entertaining ... still watch it as it stays flat ... flat ... flat.

Short story - had a friend who started numismatic investing in high school with his part time job money - met him after he joined Navy after college - when he was still buying gold coins ... we used to make fun of him. Then the prices of coins went up orders of magnitude. I keep thinking I will see him in the news ...he had hundreds of MS65 (all he bought) gold coins.

Everything is an investment - if the prices skyrocket AFTER you buy.

 

[robnplunder]

Thanks for those who gave their opinions. It seems I need to seriously look at why before investing in gold ETF.

 

[mathjak107]

IMO gold isn't really an investment but more of a hedge against inflation and rampant uncertainty in financial markets and political systems.

That said I have no problem with a small holding in gold, precious metals and other hard asset commodities, say up to 5% of a portfolio, provided one understands why they hold it and what role they expect it to play.

it has been a pretty crappy hedge against inflation . it really moves more with the dollar than moderate or low inflation .

if you bought gold back in the 1970's when you were first allowed to own it and also bought a t-bill at the same time and rolled it over , today the t-bill is worth about the same thing .

but here is what gold is good for:

gold rarely has negative real returns in a down market for stocks . so having the optimum amount of gold in your portfolio to match your stocks and bonds sets a real return floor that tends to have less losing years , tighter swings and in a diversified portfolio higher gains than just the stocks and bonds over the long term for the amount of risk . .

98% of all stock market downturns had gold hold a positive real return in the portfolio

 

[mathjak107]

interesting reading on the subject .
------------------------------------------------------------------------
"Our study demonstrates that adding gold to a typical/balanced portfolio has been beneficial across a wide range of allocations in terms of boosting risk-adjusted returns. Unexpectedly, over the 43 years studied, the optimal allocation has actually been 25% to gold and 75% to a balanced portfolio, representing a mix of roughly 45% stocks, 30% bonds, and 25% gold. In fact, investors could have allocated as much as 45% to gold based on historical analysis and still fallen on the frontier of efficient portfolios that dominate holding a pure balanced fund. "
-----------------------------------------------
at the moment i own no gold .



Gold diversification | Creating a more optimal portfolio allocation | Proactive Advisor Magazine

 

[Totoro]

For me, gold doesn't do anything. A bit like the Buffett line of thinking: you dig it up, put it a guarded house and wait .. costing resources to guard it. You are paying to wait.

Meanwhile, a company produces things, can grow etc .. if a company is healthy enough, you are usually being paid to wait.

Add into that inflation where gold has no strong correlation, low predictability, government interventions (selling down gold reserves at unknown moments) and no usefulness in virtual form if the apocalypse hits, and I'm struggling to see why anyone should have it as an investment, unless you are intimately familiar with the industry.

 

[mathjak107]

i have my fun money i like to speculate with and for me gold has been all about timing the markets not time in the markets . i have traded in and out of gld 30x this year generating profits of about 28k . it has been my biggest gainer in my fun money category .

 

[VanWinkle]

interesting reading on the subject .
------------------------------------------------------------------------
"Our study demonstrates that adding gold to a typical/balanced portfolio has been beneficial across a wide range of allocations in terms of boosting risk-adjusted returns. Unexpectedly, over the 43 years studied, the optimal allocation has actually been 25% to gold and 75% to a balanced portfolio, representing a mix of roughly 45% stocks, 30% bonds, and 25% gold. In fact, investors could have allocated as much as 45% to gold based on historical analysis and still fallen on the frontier of efficient portfolios that dominate holding a pure balanced fund. "
-----------------------------------------------
at the moment i own no gold .



Gold diversification | Creating a more optimal portfolio allocation | Proactive Advisor Magazine

Interesting reading mathjak107 and thanks for posting. From their own research, it appears that Treasuries are better ballast than gold in most all market conditions. Adding gold may improve the ballast, but 25% seems to be excessive as for the lost opportunity in equities during the normal market cycle. Much like having an excessive cash position increases drag on returns.
Thanks for posting and the research is done by a company that is big on active investing and timing the market. They may have a system that works...

VW

 

[GravitySucks]

How can you bribe a border guard with an ETF?
Buy some bullion or coins instead.

 

[VanWinkle]

i have my fun money i like to speculate with and for me gold has been all about timing the markets not time in the markets . i have traded in and out of gld 30x this year generating profits of about 28k . it has been my biggest gainer in my fun money category .

Grats

Now fun money is a whole other story.

VW

 

[mathjak107]

How can you bribe a border guard with an ETF?
Buy some bullion or coins instead.

how about when he shoots you in the head and takes it anyway . lol

 

[lwp2017]

How can you bribe a border guard with an ETF?
Buy some bullion or coins instead.

My oldest daughter was a Christian missionary in rural China for a couple of years.

If things were to go astray, Her get out of Dodge plan in order of priority was:
1. Fly home asap.
2 Go to any Western nation's consulate and ask for shelter.
3. Go to any Western business and ask for shelter
4. Head to the Vietnamese or Laotian border. We had crossings preselected.

I had ten, 1/10 ounce Gold Panda coins drilled and placed on a 14k gold necklace by a local jewelry maker. So she could purchase a ride and "pay" a border guard to cross if she was on her last option.

Westerners are allowed to have gold jewelry up to a certain weight but not coins or bullion in China.

She had paper maps & addresses, along with a space blanket, compass, water purification straws, and energy bars. She kept the " jewelry" well hidden.

She still has the gold coin necklace and a lot of rich memories.

 

[RobbieB]

I plan to get a 20 pack of American Eagles and store it in my safe next to my guns & ammo.

it's not like it will take up a lot of space -

 

[pb4uski]

I don't consider gold to be an investment.... investments generate income and gold doesn't fit into that category IMO.