how many are buying gold/precious metals?

[JHZR2]

Hi,

Im curious how many are considering, or regularly purchase precious metals as an investment vehicle.

On one hand, metals like gold can be sold in huge amounts by central banks. This isnt good for prices; I recall this happened in ~2000. That said, prices seem to be doing well.

On the other hand, with the terribly increasing consumer indebtedness, increasing energy costs and demands both home and abroad, world instability, increasing amounts of american debt held by foreign countries, it seems like there is a chance for markets to drop, and/or inflation to increase.

Gold (or other recious metals) seem to be a good protection against potential problems. It seems that it might be a good idea to take a holding in metals to help diversify.

I currently max out my retirement savings (14%), thinking that doing it now at 24 will be better long-run. I do buy inflation-indexed bonds (I bonds), and do some investing on my own in a personal portfolio and in a roth IRA. I am pretty stock heavy, but probably are between 5-10% bonds.

Im thinking of balancing things out a bit by buying gold on dips, probably American eagles, or maybe even krugerands, because the premium is typically lower.

So who buys gold, platinum, palladium or rhodium? Who do you buy through? How often do you buy?

Thanks,

JMH

 

[Pablo]

1) Hang out in the investing thread.
2) Check out GLD - the prospectus alone is worth 100 shares.

Gold is NOT an "investment"! Find out why I typed that statement.

 

[outrun]

At least from my parents culture keeping precious metals is a very important aspect of estate.

So we do keep Gold Boullion and Platinum bars as a sort of doomsday reserve.

On one hand precious metals are diversification of portfolio and the other in case things go to **** fast Gold can be liquified to cash anywhere.

As much as I think good of the long passed gold standard backed currency I do feel gold, platinum, diamonds etc are puppets to production.

All it takes are wise mining companies and bankers to manipulate production to demand and hence price control.

When my parents-parents were forcibly ejected from their estate by murderous muslim mobs it was the gold they escaped with that was their saving grace upon starting thier peaceable life anew

 

[eljefino]

It's probably worthwhile but only to about 5% of assets. A good SHTF investment is an odd piece of forested land in the middle of nowhere. You can't burn gold for heat mid-winter. Buy it on mortgage now while the rates are still low.

 

[JHZR2]

my thinking isnt so much as adoomsday type holding... Im not worried about nuclearwar, being thrown out my mobs, etc.

But I do see a chance for inflation in the next many years... rapid inflation, and since gold/peciousmetals are 'supposed' to be good protection from this,it seemslike the logical choice.

Perhaps Pt or Rh moreso even than gold. There is a lot less of thesemetals around, and IMO they areless likely to be affected by production, etc. They also have more industrial/chemical uses, which could greatly increase demand, and naturally drivevalue up as well.

Thanks!

JMH

 

[salesrep]

Your logic is sound. 10% in precious metals at the most.
they can be an inflation hedge as you state. i would however invest in closed end funds, open end funds , or UIT's instead of "hard" coins. It has been proven beyond a doubt that these investments far outperform holding the coins themselves. Another advantaage is the reinvestment of dividends you won't get holding coins. btw even though you are only 24 5-10% in bonds is very aggresive might want to consider upping your weighting to 20-25% 5-10% in metals the balance in stocks with say 20% in intl.

 

[JHZR2]

quote:

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Originally posted by salesrep:
btw even though you are only 24 5-10% in bonds is very aggresive might want to consider upping your weighting to 20-25% 5-10% in metals the balance in stocks with say 20% in intl.

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Thanks!

Im currently putting 30% of my retirement allocation (19% of my salary as of Friday thanks to matching!) into int'l stocks. This one scares me a bunch, because right now, I guess because of the dollar, its doing real well. When the dollar improves, I think this portion will take a hit, so I have to be careful.

Ill look into these funds, and start balancing things a bit by possibly buying into them. Thing is, I have been a coin collector in the past, and like coins, so there is an added enjoyment from buying both eagle type coins as well as older ones (yes the premium is high, but enjoyment is gotten as well). But at the same time, a fund makes things easy. Do you have any suggestions?

Thanks!

JMH

 

[TallPaul]

I consider gold not as an investment so much as insurance/reserve/diversification. I bought 7 oz of gold and 1 oz platinum when it was cheap (about 300 per oz gold I think and 375 for the platinum). Have it in storage and don't plan to cash it in unless the price got absurdly high. I know platinum hit aroun 600 per oz about a year or so ago.

I buy the bullion coins, prefering Canada and others that are all gold. US Eagles are fine, but include some copper for durability which darkens them. The Maple Leafs are sure pretty.

 

[salesrep]

quote:

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I would make that 20-25% of your stock allocation not overall allocation. As for the dollar's position you may or may not be correct, keep in mind the long term time frame which you have ahead of you vs. short term. As for a specific fund. ask Pablo or some of the others on the investors thread I've been out of the biz for to long now to knowledgably recommend.

 

[TallPaul]

If you want to invest in an international fund but don't want to speculate on currency fluctuations, go with the Tweedy Browne funds. They hedge every dollar of their international investments in their Global Value fund so there is no currency speculation. Also have great funds and solid investment strategy--Ben Graham style.