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Buy/Sell/Hold

richfool
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Re: Buy/Sell/Hold

#231989

Postby richfool » June 25th, 2019, 3:39 pm

CommissarJones wrote:
Laughton wrote:Now certainly doesn't seem to me to be the time to think about selling.

Agreed. I have a holding of physical that was amassed in 2002-04 and no plans to sell. Earlier this year, it seemed to me that it might be a good idea to put more money into PM investments while gold was still below £1,000/ounce, as the financial and geopolitical trends seemed to be supportive. Wish I had acted. I am hoping for a pullback of reasonable magnitude from the current highs, which would leave me sorely tempted to buy a batch of FRES shares.

From today's Daily Mail, - This is Money:
Gold hits six-year high as investors use the safe-haven to shelter from storm of weaker dollar, geopolitical tensions and falling bond yields

The precious metal rose 1.3 per cent to above $1,435 per ounce today
Falling yields, a weaker dollar and geopolitical risks are supporting gold

https://www.thisismoney.co.uk/money/mar ... 1-435.html

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Re: Buy/Sell/Hold

#232092

Postby TheMotorcycleBoy » June 26th, 2019, 8:05 am

richfool wrote:
CommissarJones wrote:
Laughton wrote:Now certainly doesn't seem to me to be the time to think about selling.

Agreed. I have a holding of physical that was amassed in 2002-04 and no plans to sell. Earlier this year, it seemed to me that it might be a good idea to put more money into PM investments while gold was still below £1,000/ounce, as the financial and geopolitical trends seemed to be supportive. Wish I had acted. I am hoping for a pullback of reasonable magnitude from the current highs, which would leave me sorely tempted to buy a batch of FRES shares.

From today's Daily Mail, - This is Money:
Gold hits six-year high as investors use the safe-haven to shelter from storm of weaker dollar, geopolitical tensions and falling bond yields

The precious metal rose 1.3 per cent to above $1,435 per ounce today
Falling yields, a weaker dollar and geopolitical risks are supporting gold

https://www.thisismoney.co.uk/money/mar ... 1-435.html

Copper price rise:
https://www.directorstalk.net/copper-ri ... er-dollar/

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Re: Buy/Sell/Hold

#232234

Postby CommissarJones » June 26th, 2019, 9:57 pm

A nice piece discussing gold's strong performance against a variety of currencies. I was not aware that bullion is at record highs against the Australian dollar and the Swedish krona.

https://www.bullionstar.com/blogs/ronan ... urrencies/

Gold also is outperforming silver this month, which has driven the gold/silver ratio above 92.

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Re: Buy/Sell/Hold

#237808

Postby richfool » July 19th, 2019, 3:22 pm


SentimentRules
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Re: Buy/Sell/Hold

#237811

Postby SentimentRules » July 19th, 2019, 3:26 pm

Gold telling us something about general markets. Most indices agree with gold apart from US. Maybe dow/Nas will come off the steroids soon

Smart money in the metals for sure. I reckon even traders are thinking.. . Hold gold/silver to next recession

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Re: Buy/Sell/Hold

#238326

Postby Stan » July 22nd, 2019, 8:19 am

Only just discovered this thread, yes precious metals are certainly flavour of the recent months at the moment.

Decided to take some profit from Gold last week now watching Silver and Zinc at the moment.

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Re: Buy/Sell/Hold

#303068

Postby 1nvest » April 25th, 2020, 12:55 am

Hampshirelad wrote:Wondered what others are doing in terms of PM's

I hold a lot of both Au & Ag.....after 5 years of doing pretty much nothing (except the brexit £ drop bonus) and watching pretty much every other asset class rise, I'm getting pretty hacked off.....

Ag has been particularly dreadful experience over the last 5 years.........
..
I'm nearing capitulation and hating this asset class.
...
How are others feeling

Sorry for necrobumping this old thread - but looking back to the end of 2017 (shortly after the OP posting date) and the prior five years to that - back to 2012, and a UK investor who ran with a 50/50 US stock and gold asset allocation, yearly rebalanced from the start of 2012 to the end of 2017 would have seen share price (accumulation/total return) rise +146% whilst gold declined -10%. However they'd have traded (via end of calendar year rebalancing) such that at the end of 2017 they'd have been holding 74% more ounces of gold in their safe (or wherever). Yes they'd have reduced the number of shares held as part of that - but that would have been reasonable action when stock total returns were advancing at a near 20% year annualised rate. For a total return/non dividend (mathematical) stock case they'd have held around 36% fewer shares (less of a decline in number of shares held if a dividend paying stock was being used/held).

At the end of 2017 relative to a Jan 2012 start date of the order ...
1.74 times more ounces of gold held x 0.90 change in gold price = 1.57
and 0.64 times # shares x 2.46 share price gain factor = 1.57
... i.e. both the same 1.57 value as that naturally occurs with yearly rebalancing back to equal £ amounts invested in each.

Yes a 10% 5 year annualised from 50/50 stock/gold is not as good/nice as a all stock 20% 5 year annualised, but in other cases it swings the other way around (2008 for instance when stocks were down a lot, 50/50 stock/gold was up +14%; Or in multiple years in other cases - for some data see viewtopic.php?p=302964#p302964).

That's the nature of holding and rebalancing gold. If you just hold it, don't trade it, then its just a door-stop dead-weight. Gains can arise out of price appreciation, income (dividends/interest) and/or volatility trading. Some investors may specifically target each of those, growth investors looking for price appreciation, high yield dividend investors looking for income, Options traders looking for volatility. None of those is consistently the better as otherwise all investors would converge. Diversifying across all three is the more balanced approach. As part of trading gold over some periods you will see the price decline across multiple years during which you expand/accumulate more ounces of gold; And over other periods see the opposite, reducing ounces of gold held, accumulating more stock shares. Those trends can persist for decade(s). The Dow/Gold ratio for instance has seen swings from where it took just a little over a ounce of gold to buy the Dow to highs of where the Dow bought 40+ ounces of gold.

Image

Both stocks and gold are long term investments (short term speculations). If you're not into stocks for the longer term then equally gold isn't for you either. Stick with shorter dated bonds/cash deposits instead. That said, 50/50 stock/gold is a better shorter term (decade, maybe less) choice than either stock or gold alone, as that's a form of extreme barbell, somewhat similar to how some opt to hold short dated gilts and long dated gilts (20+ years from maturity) in equal measure as a alternative to holding a central 10 year bond bullet.

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Re: Buy/Sell/Hold

#303198

Postby BT63 » April 25th, 2020, 2:02 pm

I don't post much about gold because most people who hold shares have strong negative views about it. On the other hand, I've often felt unwelcome on precious metal forums because those people have negative views on equities (apart from PM miners!).

However, for the last two decades I have included a meaningful amount of gold because at the start of the period it was cheap and since the start of the period the financial situation hasn't looked great.
As equities have slowly and erratically come down to more reasonable valuations I've gradually shifted money back into them.

Gold currently amounts to about 30% of my portfolio, with the remainder being about 15% cash, 55% shares.

I think gold's trend is likely to be higher over the next year or two, but very volatile at times, with some sharp pullbacks after upward bursts. I think the trend for general equities is likely to be flat to lower for many months yet and I hope to be able to put a good amount of the cash into equities, along with taking opportunities to sell (rising) gold to fund the buying of (falling) shares.

As time goes on, over the next several years I expect to gradually lower my gold holding to about 5-10% of portfolio, but probably never below 5%.

I wonder if, over the next few years, we will see the final large upmove in gold before it burns itself out as it did in 1980, giving way to another two-decade stockmarket bull market.

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Re: Buy/Sell/Hold

#303231

Postby 1nvest » April 25th, 2020, 5:24 pm

Hi BT63
I wonder if, over the next few years, we will see the final large upmove in gold before it burns itself out as it did in 1980, giving way to another two-decade stockmarket bull market.

Back then inflation was high, so also were interest rates ... and taxation. 15% inflation, 15% interest 40% tax and .... savers/pension funds lost -6%/year. The subsequent progressive decline in yields since then = higher prices for both stocks and bonds (and house prices).

This time around the 'new era' seems to be towards very low nominal yields, negative real yields (after inflation) ... savers/pension funds losing out.

People are anticipating a 'return to normal' positive real yields, but pension funds have to buy Gilts and as yields move even more negative so they have to buy even more, pushing prices even higher/yields lower. The treasury in effect is being paid to lend, debt becomes a asset. Similarly rather than the cost/effort of collecting taxes, its easier/cheaper to just print money and spend it - which is a form of micro-taxation (all other notes in circulation are devalued). And that's becoming the new era 'norm' (tracking down and collecting taxes in a global village is otherwise difficult).

If so, then negative real yields could become a long term feature. In which case investors/savers will look elsewhere to avoid paying the treasury to safe keep their money. Things like gold. As gold is volatile however, 50/50 it with stock and the two tend to counterbalance reasonably well. All gold is as bad as all-stock.

Since 2008 gold has risen from around £300/ounce to £1300/ounce, a annualised rate of 13% - well ahead of inflation. Much of that was down to a correction out of gold being out of favour, such gains wont persist mid/longer term. I suspect we're at levels where gold is more around a fair price level, having recorrected from being cheap https://tinyurl.com/yaeqepx4

In a era of where bonds become high risk, pretty much guaranteed to lose money if bought and held to maturity, 50/50 stock/gold barbell will become the future 'safe bond' IMO. Regression analysis suggests that 1986 might be a good baseline start date for relative comparison https://tinyurl.com/y7dmalqq but where I suspect that forward time as prior high to low yield transitions expire and roll into negative real yields for bond barbells/bullets/ladders that the two will diverge with bonds flat/down in real terms whilst stock/gold might continue real gain progression as before.

But what if inflation/interest rates do spike heavily back into positive real yield territory, a repeat of the 1970's type rise? Well Harry Browne opted to split 50/50 stock with equally with bonds, and rather than a 10 year bullet (25% stock, 25% gold, 50% 10 year gilt bullet), he instead opted for a short/long dated gilt barbell for the bond holdings. The difference however is just noise https://tinyurl.com/y76rvsrv (that chart goes back to 1978 as that's as far back as they have long dated treasury data for).

Personally from the current date, I'd be more inclined to allocate the bond half to a 3 or 5 year High Street Bank fixed rate bonds ladder (roll each maturing bond into another 3 (or 5) year bond as/when a bond matures, where if you're rich enough - ensure not to exceed depositor protection limits with any one provider https://www.moneysupermarket.com/saving ... ate-bonds/ (with Gilts, you're pretty much protected up to any limit, and have near instant access, unlike fixed rate bonds where there are usually penalties if you look to close/withdraw early). With shorter dated bonds you have a third (5th for a 5 year ladder) maturing each year, such that if interest rates have risen you roll into them sooner rather than later (with a 10 year bond you have to wait a decade for it to mature/roll).

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Re: Buy/Sell/Hold

#303246

Postby 1nvest » April 25th, 2020, 6:24 pm

BT63 wrote:Gold currently amounts to about 30% of my portfolio, with the remainder being about 15% cash, 55% shares.

I have been relatively content with US stock holdings, but have FT250 alongside that. Increasingly however I am being tempted towards a simple 3-way equal split of FT250/Gold/Cash. Harry Browne's Permanent Portfolio with its 50% in bonds is a little too conservative and a US$/global currency/£ diversification seemed appropriate, but annoyingly incurs 15% US dividend withholding taxation on around 2% average dividends (0.3%/year cost on top of fund fees) and currency conversion costs against dividends due to not being able to hold foreign currencies inside a ISA.

Moving over to 67/33 £/foreign, i.e. FT250 and cash in £, gold = global currency has the quality that if the pound does halve in value so gold might double in price, such that 66.6% halving, 33.3% doubling = break-even ... type thinking.

Has to be the right sort of stock fund however - where for various reasons the FT250 fits the bill. FT100 can have high weightings in individual stocks/sectors and periodically that can backfire and drag down the whole. FT250 is much less inclined to do so, has much less single stock risk elements and even includes around 20% weighting into Investment Trusts - so widely diversified with not too much in any one single stock. IT's do make the index look 'financials' heavy, but they individually diversify much more widely outside of financials.

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Re: Buy/Sell/Hold

#303300

Postby Wuffle » April 26th, 2020, 7:26 am

Interesting stuff.
I have taken to reading back the odd thread from different times for perspective.

The ratios are historically out of whack with silver (and plat) very cheap against gold I notice.

W.

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Re: Buy/Sell/Hold

#303307

Postby GoSeigen » April 26th, 2020, 8:32 am

Wuffle wrote:Interesting stuff.
I have taken to reading back the odd thread from different times for perspective.

The ratios are historically out of whack with silver (and plat) very cheap against gold I notice.

W.

I wonder if the collapse of crude oil prices will spark a revival for platinum: by killing off the electric car trend and restoring demand for cat converters in petrol vehicles?


GS

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Re: Buy/Sell/Hold

#303685

Postby 1nvest » April 27th, 2020, 8:06 pm

Wuffle wrote:Interesting stuff.
I have taken to reading back the odd thread from different times for perspective.

The ratios are historically out of whack with silver (and plat) very cheap against gold I notice.

W.

Thanks Wuffle. Hadn't really looked/noticed. A recent chart however is indicating its highest level since 1919 (and maybe longer).

Image

What's a reasonable way to add silver exposure? A quick search indicated near 0.5% expense ratios for typical exchange traded products. 3SIL looks a potential choice for me (its a 3x leveraged version, but I'd only invest a third of the amount in that for 1x like exposure, that would reduce its expense ratio down to 0.33%). https://tinyurl.com/ycxuewbq

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Re: Buy/Sell/Hold

#311070

Postby GoSeigen » May 22nd, 2020, 2:52 pm

Also now wondering what I should do about my metals and mining shareholdings, which now account for roughly 25% of our net worth, partly because of falls in other parts of the portfolio and partly because they have performed well in the past two years, the best stock being a 5-bagger in that period.

I've already reduced exposure to this sector by some 10% of net worth over the past year. So what do other Fools think: is it now time to aggressively take profit, especially in the biggest positions, or should I be patient and let the positions run?

Looking at news flow it seems everyone is getting excited about metals, which is always a warning sign...


GS

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Re: Buy/Sell/Hold

#311089

Postby dealtn » May 22nd, 2020, 3:36 pm

GoSeigen wrote:Also now wondering what I should do about my metals and mining shareholdings, which now account for roughly 25% of our net worth, partly because of falls in other parts of the portfolio and partly because they have performed well in the past two years, the best stock being a 5-bagger in that period.

I've already reduced exposure to this sector by some 10% of net worth over the past year. So what do other Fools think: is it now time to aggressively take profit, especially in the biggest positions, or should I be patient and let the positions run?

Looking at news flow it seems everyone is getting excited about metals, which is always a warning sign...


GS


Why is it so binary?

Just take some profits "non-aggressively" and run the rest.

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Re: Buy/Sell/Hold

#311500

Postby 1nvest » May 23rd, 2020, 4:50 pm

dealtn wrote:
GoSeigen wrote:Also now wondering what I should do about my metals and mining shareholdings, which now account for roughly 25% of our net worth, partly because of falls in other parts of the portfolio and partly because they have performed well in the past two years, the best stock being a 5-bagger in that period.

I've already reduced exposure to this sector by some 10% of net worth over the past year. So what do other Fools think: is it now time to aggressively take profit, especially in the biggest positions, or should I be patient and let the positions run?

Looking at news flow it seems everyone is getting excited about metals, which is always a warning sign...

GS

Why is it so binary?

Just take some profits "non-aggressively" and run the rest.

1980's and 1990's and gold had a bad couple of decades, stocks did well.
Since 2000 and gold has outperformed stocks.
50/50 yearly rebalaced of the two saw gold price down a third across the 1980's/90's, but around 6 to 8 times more ounces of gold having been accumulated. Since 2000 its been more of a reversal, reducing ounces of gold to add more stock shares.

Don't know and don't really care - but likely over the next 12 months one or the other will do well. Diversification and rebalancing has you 'trade' in a add-low/reduce-high like manner.

I consider stock/gold 50/50 as a form of barbell of two extremes that combine to a central bond bullet type holding (currency unhedged long dated global bond). 75/25 stock/gold broadly being comparable to 50/50 stock/bond https://tinyurl.com/y7e2gnao - but more volatile (potentially more tax efficient) and subject to time period https://tinyurl.com/y8tuchxw

That mid 1980's is a good 'central' start date timepoint IMO (first of the above two links), and to recent its not particularly indicating much of a deviance between the two.

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Re: Buy/Sell/Hold

#314260

Postby 1nvest » June 1st, 2020, 2:18 pm

50/50 stock/gold ....

Since 2000 https://tinyurl.com/yap4vx6k has somewhat been similar to the 1970's https://tinyurl.com/yd5b8ohz

Over other periods it swings completely around https://tinyurl.com/ydez332b

Note all of those links/charts are after a 4% SWR. In some cases that's predominately being provided by just one of the assets, along with additional surplus real (after inflation) gains to also reduce-high to add-low to the other asset.

Be sure to check/tick the log and inflation options in the Portfolio Growth chart to better see the outcomes in real (after inflation) terms. 50/50 since 2000 is up nearly 40% in real terms - and that's after the 4% SWR. Certainly been a period for accumulating/topping up on stock. Whilst 1980's/1990's was a period of stock providing the SWR (along with topping up on the number of ounces of gold being held).

Image

All-stock after 4% inflation adjusted income being drawn each year out of total return (4% SWR) seeing stock value down nearly 60% in real (after inflation) terms since 2000.

Yes that data is US, as that's more readily/easily available. UK has seen even more of a extreme.

For a UK investor holding US stock and assuming they're a UK home owner, then that's currency diversification of £ (home value), primary reserve currency US$, global currency (gold). With asset diversification of land (home), stocks, and commodity (gold). Similar to as advocated by the ancient Talmud millennia ago (third each : land (home), commerce (stocks), reserves in-hand (gold))

Image

Gold has a (often multi-year) inverse correlation to stocks and when stocks are up/gold down, has you adding to ounces being held/stored, and vice versa (deploying ounces of gold to add more stock shares when gold is up/stocks are down).

Trying to timing that is futile, best to just yearly rebalance - and take what's given. Which as the above Callan Periodic Table indicates can be "satisfactory" enough.

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Re: Buy/Sell/Hold

#322793

Postby GoSeigen » June 30th, 2020, 3:09 pm

dealtn wrote:
GoSeigen wrote:Also now wondering what I should do about my metals and mining shareholdings, which now account for roughly 25% of our net worth, partly because of falls in other parts of the portfolio and partly because they have performed well in the past two years, the best stock being a 5-bagger in that period.

I've already reduced exposure to this sector by some 10% of net worth over the past year. So what do other Fools think: is it now time to aggressively take profit, especially in the biggest positions, or should I be patient and let the positions run?

Looking at news flow it seems everyone is getting excited about metals, which is always a warning sign...


GS


Why is it so binary?

Just take some profits "non-aggressively" and run the rest.


Hmm, well I've sold off about 40% of my stake in my largest holding, and then today this happened:

https://www.investorschronicle.co.uk/ti ... opavlovsk/

Never dull in investing, eh?

GS


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