Anyone else notice how much it's swung in the past few months? Don't know what to make of it, just seen it moved quite a bit.
I watch it as an opportunity to trade one for the other. I think I only actually did that once or twice in the last five years. That being said, I think I traded gold for platinum, and that spread never did reverse itself. Oh well I guess. I think it was back in April, Silver:Gold was around 81 for a top, and it's back down to 66 now. If it hit 60, a guy could trade 60 silver for an ounce of gold. Transaction costs may be 6 ounces to do it though too. ***I think I remember now. I bought my gold when it was less than platinum. Then the inversion happened, and I traded the gold for platinum and picked up 6 oz of silver with the remainder.
Its possible to try to arbitrage between them I suppose. I guess I am just old fashioned, I buy it and put it in the SDB or safe to sit there for the next few decades. The only thing I would worry about is it seems to be similar to rebalancing. I HATE rebalancing. I think financial "experts" suggest it to drive up fees. Nearly every scenario I have seen shows rebalancing lowers long term returns unless very specific events/timeframes are chosen. Even stuff like 2008 you were better off to never rebalance if you were going to hold for a few years after the event.
Rebalancing can be a dangerous thing if it doesn't have some reason behind it. In stocks, you could continually be taking steam out of high performers, and throw that money into falling piano investments, which could erode a lot of wealth before it's worked itself out.
Just buy one or the other, both or all three. Hold and hold and hold. Then sell when it goes high but you gotta ride the hills and valleys. It goes up and falls back, then it goes up higher but falls back again. Sooner or later, it reaches a peak, holds for awhile, then falls in the reverse pattern of going up. It takes patience and you may lose a few fingernails but you can make some good money if you ride the wave.
I'm behind this idea 100%. I buy pullbacks, watch for runs - and in particular - I buy on the cheap. Meaning any time I am at an auction or estate sale, I'll pick up gold, silver and platinum in almost any form if I can get it close to melt value. I had a bang-up year with sterling flatware/silverware and jewelry. The coins I almost always keep.
