Is anybody still buying silver and gold?

Most people can only purchase when they have money. They dollar cost average into what ever they like in metals.
Sometimes deals do appear. Not always are funds there to buy. Some sort of percentage should be established for any portfolio. The younger you are and invest your chances are better at going through more ups than downs hopefully .
I just like certain collectibles. Bullion will be the best deal among the accepted countries who produce bullion coins.
Simple is good but knowledge is the power to do well.

Pep

 

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But you will still be wrong because your facts and reasoning are wrong. Basically you are flipping a coin and taking credit for the result.

 

I think my facts are 100% correct. Flipping a coin is completely random, so it's not like that either.

 

I won't pretend to know what many of you in this forum know and understand. I buy silver coins and buillion when it strikes me to and try to pay less than spot. I had decided to put a certain amount of cash toward this stuff as just another type of diversification and will keep doing so, regardless of the price. However, what I've been trying to do lately is buy coins for melt that I would have been paying more for when silver was lower. I purchased a bunch of Barber halves, a few seated halves, barber quarters, barber dimes, BU merc dimes and some other random silver coins for under spot. I'm assuming that when/if silver drops back, these coins will still keep much of the value that I paid for them. I love just having them though so I'm not worried.

 

That is essentially my approach to bullion buying as well-- go for the numismatic coins that are selling for around spot.

 

Also keep in mind that the ONLY thing DCA does is to mathematically ensure that your cost basis is lower than the average price over the time you use it. It doesn't prevent you from overpaying and it doesn't ensure that you will make money. In fact, the only way that it is possible to make more money using DCA than using lump sum investing is if (1) the price is much lower than the entry price for a period of time that it is in use, and (2) the ending price is significantly higher than the low. So you might say that DCA works only in one special situation that may or may not occur. A long time ago Forbes magazine ran an article entitled, "25 Ways to Lose Money Dollar Cost Averaging" and I wish I had saved it to share.

I know there are many DCA fans here who will disagree, but you can prove this for yourself by running scenarios on a spreadsheet. It's just the way it is.

 

Lump sum would be great. But assuming I will retire with say 50-100 oz of gold it would have been hard to scrape that much money together at one time in addition to my other expenses and investments. Lump sum is just not practical for most people.

 

I would suggest that every time you make an investment, you should ask yourself if whatever you plan to buy is the absolute best investment idea you can come up with at the time. And at one time it may be gold, another silver, another stocks and another bonds. To plan ahead of time to accumulate a certain quantity of metal using DCA may not be the best you can do.

 

The market tanked again today so I got the wife to let me buy a couple more silver dollars.

 

You can lose your rearend off on the wrong end of a lump sum both sytems have its advantages and disadvantages

 

Not with any decent type of loss control.

 

Cloud, I know you and I disagree about DCA. My take, is that most people do not have the money to put all money they want to have in an asset at once. Therefor, if you will be buying periodically, DCA is superior unless you KNOW when to buy on lows. My crystal ball is broken, so I never KNOW, so I simply invest what I can periodically in a DCA manner.

Any comparisons Cloud that state only one particular scenario makes DCA valuable I would have to see the details. The devil is in the details in these analysis, and I have seen WAY too many underestimate risk, cost of funds, etc etc ad nauseum. Of COURSE, if someone can predict the market, know when its low and will go higher, or when its high and will go lower, they should take advantage of that knowledge with a ton of cash. Most people:

1. Do not know this
2. Do not have very much liquid cash at a time
3. If they try to guess the market small investor psychology will have them "betting the farm" in high markets, and selling in low markets. Everyone has seen this repeatedly. I actually use small investor sentiment as my BEST predictor of future market direction, EXACTLY OPPOSITE their view. Many financial professionals do the same.

So, to me, absent superior knowledge than the market AND the cash to use, most investors ARE better of DCA into a market over time.

If anyone has a detailed study showing another method to get into a market over time, I would be glad to review the study, methodologies, and assumptions.

Chris

P.S. Yes, I know I will never change your mind either Cloud, and that is cool too.

 

This is where I fall. I try to invest a set amount of money each year in PMs - partly for fun, partly as an investment or value lock that I'll use when my kids need it. I'm not sure if what I do is DCA or not - I just simply try to find what I believe is a good deal - once or twice per year and purchase what I want. Honestly - I would have like to purchase more back when it was 12 and again at 17 an ounce but there is only so much liquid cash and I wasn't about to refinance or take equity out of my house to come up with more capital.

 

DCA may not be the absolute best way to invest in any thing, but many times for many people, it is the only way.
Lump sum is difficult, and I would always spread it out over several types of investments. To insure such buys the instruments to protect a single item purchase can add a bit to the bottom line cost .
Interests and investments cross a path where people want to see if they can make something to show for their effort.
No one likes to be wrong.
Some items do work when there is blood in the streets , buy. Some times it is your blood.

 

I'm looking at buying some silver here as investment, from what yall are saying, now is not the time?

 

Not everyone is saying that. The opinions seem more or less split.

 

The problem is most likely the way I explain it. If someone is convinced that they have to invest on a periodic basis regardless of whether or not it is warranted, then DCA is what they are going to use. But if someone can't distinguish highs from lows or properly analyze a company, they probably shouldn't be investing at all unless it is with money they won't miss if it is lost. I would change my mind if the math worked, but it doesn't.

There are other formulas that someone can investigate to see if it suits their needs. They aren't a substitute for knowledge, but all are better than DCA in my opinion. The following is a sample:

http://en.wikipedia.org/wiki/Value_averaging
http://www.barnesandnoble.com/w/superpower-investing-robert-lichello/1018829315
http://www.aim-users.com/twinvest.htm
http://www.amazon.com/How-Make-Stock-Market-Automatically/dp/0451204417 [don't be put off by the title. the book is packed with ideas]

 

Nobody here knows whether or not this is a good time to buy silver. It certainly isn't as good as it was when silver prices were much lower, but that doesn't mean it can't go higher. It's a decision you have to make based on your risk tolerance, personal financial situation, and how much you plan to buy.

 

I'm new to the game so my advise might not be the best, but I buy silver coins. For example I buy the Britannia coins. I also used to buy some of the panda silver coins(though you have to watch our for fakes). Typically your coins go up in value. The prices seem to jump if ebay is any indication(though I suppose it isn't the best indicator). Still, I have never seen a coin go down in value unless its in poor condition.

I dont buy silver bars only because the price hinges on where the silver market is at the time. So my silver bar could dip back down to 20 bucks. It is unlikely that any coin I buy will go down to 20 dollars.

While everyone says do what you love and dont intend to make a profit on it, and that is true, but its still nice to turn a little profit. I think thats why I don't buy every silver coin I come across. I'm picky on the designs.