Friday, July 1, 2016

In Gold, I Trust 2016

For long time readers, most of you would know that I'm quite the gold bug - which by today's loose definition, means anyone that actually owns investment-grade gold.

Although quite a lot of the markets have actually recovered from the BREXIT shock, unsurprisingly, one of the strong performers post BREXIT has been precious metals. It was not too long ago when gold was trading in the $1050s and people were expecting support failure at $1000 and that we plunge below that.

(chart from BullionStar)

Just before and after BREXIT, gold in GBP popped 19% on the day. Yes, madness. However, from the trough of late 2015, it's actually crazy how Gold has increased by 40% in just about 6 short months.

Personally for me, my pet rock holdings available for sale is +18%. If you count in the selling costs involved, it drops to about 13%. However, that transaction costs has always been a known factor, and that is just the price to be paid to be able to grab your pet rock and run.

My gold unit trusts unfortunately is only up 20%. I had to take an unexpected hit when one of the funds was closing down and the switching period was very.... ill-timed. However, up 20% is still pretty good for the start.

As for my personal stash, I would make a quick 10% if I offloaded it in the market today. However, this is my zombie-apocalypse emergency stash, so it's probably going to the grave with me.

Although it has been a while, I am rather pleased with these promising returns. Mind you, this has been the worst gold bear markets in history, and now we seem to just be coming out of it. You can see for yourself from this slightly outdated chart marking the final troughs.

Well, what this means to me is that the risk/reward for investing in Gold or Silver is very high. If investing in barbaric pet rocks make you sick, perhaps consider this the relationship between debt and gold, and Gold's ability to protect in currency crisis.

I don't know if this is the start of the bull market, but Phillip Capital seem to think so with their latest report.

As always, Incrementum Funds have come out with a massive document that covers all things gold. If you're a serious precious metals investor, or if you really want to know more about gold, then this is a MUST READ.

My take on Gold or precious metals is rather simple, and it is pretty much the same as other assets as well: The more ugly and unattractive something is, the more interested I am to be an owner. And gold has been performing horribly in the recent years, which makes it look amazing to me.

That's just how I roll though, balls deep.

If you asked me what's my biggest position right now, the answer would be gold. And I am happy to be in the company of serious investing legends like Druckenmiller and others (I can't seem to find the source page that were showing the who's who in the investing world and their massive gold positioning).

Anyway, the plan is to closely monitor the market and to see how things go. From what I'm seeing now, I'm still hoping for a big pullback and correction to flush out all the weakhands and speculators, and then I'll probably load up my final haul. If anything, I might have too much exposure in gold.

As usual, when the time is right, I'd be placing my orders to BullionStar either for them to store my BSP or for me to arrange a self-collection a few days later.

Full disclosure: If you enter BullionStar through my site, and you buy anything, I get a small commission.

Whether you buy at BullionStar directly or enter from my site, the price you pay does not change. The only difference is whether I get a cut for referring customers or not.

My personal precious metals investments are stored with BullionStar and I pay the same fees as any other regular customer.

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