Discussion in 'Bullion Investing' started by Bman33, Jan 27, 2020.
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Clearly you've never lived through a basket handle failure.
Is there some type of formula that would explain it? Or maybe it's what bullion dealers say to stay in business.
Is that to simply diversify?
Do you have *any* desire to buy low/sell high mentality because selling would just lower that %.
I think 5-10% if your net worth is low.
As your net worth increases it seems impossible to keep up with that depending upon how your net worth increases. If you Net Worth increasing as your house valuation is increasing ... retirement acct ... if cash flow isn't increasing you may not have the means to increase your %.
If your net worth decreases does that mean you should sell your PMs ?
My PM % is now less than 5% and I have no desire to increase it at this time.
If PM prices drop below $1300/$13 I'll consider doing something. Until then, well I sold off to capture the gains. You know .. buy low, sell high. If you don't just "hoard" then that % will vary based upon your buy/sell patterns if that is your objective.
Buy what you feel comfortable with. Hold what you feel comfortable holding.
At some point you may ask yourself "why" you have such a level.
What is it doing to help put food on the table either now or in retirement.
But here is something interesting. If you use it to counteract any future political, market upheavel, etc. Then you have to look back and see if you invested that $$ into something else like a S&P index fund, what gains did you avoid. If if there was a market crash at some point, were those gains in the index fund still above the current position of the PM (using total cost of ownership). If you bought gold in 2012 vs S&P index .... where would it be today? It's all one of those cherry picking conversations.
Also, avoid bullion dealer conversations about this as they generally have a bias. They'll even tell you to go 15% if you are at 10% (I had that conversation once lol)
@Clawcoins Still confused about the 5-10% number. Was it random?
It comes from Hedge Fund managers who want to hedge against the market. At least the modern interpretation of it.
The only problem is .. the yellow line has an undisclosed investment. So it could have been 100% Apple stock for that percentage with the rest of the investment a dog.
And the S&P white line is for "No Dividends Reinvested" or even considered .. it just floats away. If Dividends were reinvested then that number would be more than TWICE that.
It all comes down to *HOW* you want to compare and define Apples to Oranges.
If your house valuation is increasing, and the stocks and bonds in your retirement account are increasing in value, but you have to keep buying more PMs to maintain that percentage... maybe it's time to think about why you would want any higher percentage in PMs, an asset that does not generate income or provide utility.
I bought a good bit (by my standards) of gold and silver, and even some platinum, when they were higher. I bought some more on a couple of occasions since when I was convinced that equities in general were about to tank. Still waiting.
I'm considering getting out of my position on Gold and silver while I can break even or just a hair above. Seems to be better doing something else with my money.
Nope. I make sure my basket is in working order.
Breaking even shouldn't be relevant to your decision, though. If you think there's something else more likely to go up than gold and silver, sell them, take the loss, and put your money where it will grow.
I sure wish I'd sold a few more grand of silver and gold at a loss in 2013-2014 and put the proceeds into the market. I'm doing all right, but I'd be doing that much better.
No formula that I know of. And I've had numerous sources say the same. Bullion or coin dealers, stock market investors, money market and bank managers all say the same thing. Be diversified.
My wife had to move her 401k so she went to a large firm that deals in such. Her new manager tried to get her to diversify. I kept telling her to leave it all in the one stock she had. Did she listen to me? No! She listened to him and sold 10% of her stocks. She got her quarterly statement two weeks ago and guess what? She would have been up an additional $3500 if she would have kept her shares in that one stock.
My experience has been all the people that deal in handling accounts say that one word-diversify. I've found out that in certain cases it's best not to.
And there's exactly one tool that lets you identify those cases: HINDSIGHT.
I'm happy to have stock in Apple and Google and Autodesk. Not so happy about the money I put into Nortel and Citibank. If you'd asked 10 people in the early 2000s which one stock to go all-in on, they sure wouldn't have picked Apple. They might well have picked Nortel or Citi. Bad luck for them.
yeah but as you get older you start thinking of your term limits and not the PMs
As long as the good decisions outweigh the poor ones we should be alright.
Understood but I'm retired and 65 and I still have my pm's. In fact, I still buy them when the price is right.
But if you put all your money into one stock -- and that is the advice you gave your wife, right? -- you're gambling that that one stock will be a winner, not a loser.
I'd have more money now if I'd put it all into one "winner" stock. I'd have less if I'd put it all into one "loser" stock. And you can reliably identify winners and losers ONLY in hindsight.
Everyone has all various reasons for collecting, trading, hoarding, etc PMs.
Separate names with a comma.