Is anyone putting money aside into Gold?

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uberational44
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Is anyone putting money aside into Gold?

Post by uberational44 » Sat Dec 16, 2017 9:50 am

I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
Marketeer investing as a hobby. Interested in modern takes on value investing, passive investing and general contrarianism.

Jack FFR1846
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Re: Is anyone putting money aside into Gold?

Post by Jack FFR1846 » Sat Dec 16, 2017 10:13 am

Nope. Burned badly enough with silver coin purchases. Negative gains don't interest me anymore. Dump, baby, dump.
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 10:17 am

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
In theory, theory and practice are identical. In practice, they often differ.

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 10:17 am

Jack FFR1846 wrote:
Sat Dec 16, 2017 10:13 am
Nope. Burned badly enough with silver coin purchases. Negative gains don't interest me anymore. Dump, baby, dump.
Silver and gold are two different investments, not much more similar than stocks and bonds are to each other.
In theory, theory and practice are identical. In practice, they often differ.

uberational44
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Re: Is anyone putting money aside into Gold?

Post by uberational44 » Sat Dec 16, 2017 10:21 am

technovelist wrote:
Sat Dec 16, 2017 10:17 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
You may not be wrong about masochism! I am young though, so I can recover if things go pear-shaped..

I agree with you on the price as well
Marketeer investing as a hobby. Interested in modern takes on value investing, passive investing and general contrarianism.

spectec
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Re: Is anyone putting money aside into Gold?

Post by spectec » Sat Dec 16, 2017 10:33 am

I think lead is a better investment than gold. If the worst case situation ever develops, having enough lead will increase your odds of keeping your gold.
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers

diy60
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Re: Is anyone putting money aside into Gold?

Post by diy60 » Sat Dec 16, 2017 10:46 am

uberational44 wrote:
Sat Dec 16, 2017 10:21 am
technovelist wrote:
Sat Dec 16, 2017 10:17 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
You may not be wrong about masochism! I am young though, so I can recover if things go pear-shaped..

I agree with you on the price as well
I remember the euphoria in the office around 1979, gold was spiking at $800/oz. Some colleagues bought gold coins that included additional markup. Today 40 years later gold is $1200/oz, how pathetic is that !

I bought gold mining stocks in 1985 or so, I thought it was a good hedge against a big market drop. My mining stocks dropped like a rock just like the rest of my investments in the crash of '87.

I learned my lesson decades ago.

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Re: Is anyone putting money aside into Gold?

Post by uberational44 » Sat Dec 16, 2017 10:52 am

diy60 wrote:
Sat Dec 16, 2017 10:46 am
uberational44 wrote:
Sat Dec 16, 2017 10:21 am
technovelist wrote:
Sat Dec 16, 2017 10:17 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
You may not be wrong about masochism! I am young though, so I can recover if things go pear-shaped..

I agree with you on the price as well
I remember the euphoria in the office around 1979, gold was spiking at $800/oz. Some colleagues bought gold coins that included additional markup. Today 40 years later gold is $1200/oz, how pathetic is that !

I bought gold mining stocks in 1985 or so, I thought it was a good hedge against a big market drop. My mining stocks dropped like a rock just like the rest of my investments in the crash of '87.

I learned my lesson decades ago.
I'm not surprised!

I see buying gold as the opposite of the famous warren buffett quote:

Be greedy when others are unfearful


If you had bought in the early 1970s, the returns would have been serious!

http://static5.businessinsider.com/imag ... g?maxX=590


Gold mining is a strange one... they can go up, or down after a market crash. I have strong conviction that gold is under-valued, so willing to withstand a little volatility. I think :D
Marketeer investing as a hobby. Interested in modern takes on value investing, passive investing and general contrarianism.

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unclescrooge
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Re: Is anyone putting money aside into Gold?

Post by unclescrooge » Sat Dec 16, 2017 11:01 am

Yes, 2.5% of my portfolio is in gold and gold miners.

Also have a stash of gold coins I bought around $600/oz back in 2005/2006.

technovelist
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 11:21 am

uberational44 wrote:
Sat Dec 16, 2017 10:52 am
diy60 wrote:
Sat Dec 16, 2017 10:46 am
uberational44 wrote:
Sat Dec 16, 2017 10:21 am
technovelist wrote:
Sat Dec 16, 2017 10:17 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
You may not be wrong about masochism! I am young though, so I can recover if things go pear-shaped..

I agree with you on the price as well
I remember the euphoria in the office around 1979, gold was spiking at $800/oz. Some colleagues bought gold coins that included additional markup. Today 40 years later gold is $1200/oz, how pathetic is that !

I bought gold mining stocks in 1985 or so, I thought it was a good hedge against a big market drop. My mining stocks dropped like a rock just like the rest of my investments in the crash of '87.

I learned my lesson decades ago.
I'm not surprised!

I see buying gold as the opposite of the famous warren buffett quote:

Be greedy when others are unfearful


If you had bought in the early 1970s, the returns would have been serious!

http://static5.businessinsider.com/imag ... g?maxX=590


Gold mining is a strange one... they can go up, or down after a market crash. I have strong conviction that gold is under-valued, so willing to withstand a little volatility. I think :D
The problem is that gold mining is not the same as gold owning.

The miners can have many problems that don't affect physical gold, mostly due to politics in the (mostly undeveloped) countries where most of the mining is done. But there are many other issues as well, including fuel costs, weather/transport problems, and unions. There have also been a number of fraudulent companies in this sector.
In theory, theory and practice are identical. In practice, they often differ.

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Tamarind
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Re: Is anyone putting money aside into Gold?

Post by Tamarind » Sat Dec 16, 2017 11:25 am

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
Before I knew better, I lost a couple of thousand on IAG and another gold miner whose ticker I forget. It was part of my (thankfully pretty cheap) education in why I shouldn't pick stocks. I didn't get to claim a loss as they were in a Roth IRA. :oops:

Gold is one thing (non-value-producing, volatile, etc). Gold miners take all the fun volatility of gold prices and add to it debt, unexpected failure of veins or whole mines, capex, political instability, and bad futures contracts. Don't do it unless you have years of experience in the industry, and probably not even then.

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dwickenh
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Re: Is anyone putting money aside into Gold?

Post by dwickenh » Sat Dec 16, 2017 11:40 am

No Gold as I think Treasuries will do the same thing in a down market and they do pay some interest.
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Re: Is anyone putting money aside into Gold?

Post by livesoft » Sat Dec 16, 2017 11:44 am

Gold is pretty to look at and hold in one's hands. At least that's the only reason for owning gold concluded by all the gold bugs who participated in this very recent gold thread: viewtopic.php?f=1&t=233083
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 12:00 pm

dwickenh wrote:
Sat Dec 16, 2017 11:40 am
No Gold as I think Treasuries will do the same thing in a down market and they do pay some interest.
If interest rates ever go back up to anything resembling historically normal levels, Treasurys will get massacred, whereas gold may do very well.

Just look at the 1970's for an example of this.
In theory, theory and practice are identical. In practice, they often differ.

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Re: Is anyone putting money aside into Gold?

Post by Dottie57 » Sat Dec 16, 2017 12:02 pm

livesoft wrote:
Sat Dec 16, 2017 11:44 am
Gold is pretty to look at and hold in one's hands. At least that's the only reason for owning gold concluded by all the gold bugs who participated in this very recent gold thread: viewtopic.php?f=1&t=233083
Pretty gold is the reason I have gold in the form of a few pieces of nice jewelry.

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 12:03 pm

livesoft wrote:
Sat Dec 16, 2017 11:44 am
Gold is pretty to look at and hold in one's hands. At least that's the only reason for owning gold concluded by all the gold bugs who participated in this very recent gold thread: viewtopic.php?f=1&t=233083
I think that is a slight oversimplification.

Besides those characteristics (which I agree with), gold has myriad industrial uses and has been used as money for thousands of years.
In theory, theory and practice are identical. In practice, they often differ.

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Re: Is anyone putting money aside into Gold?

Post by ruralavalon » Sat Dec 16, 2017 12:04 pm

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I have never and will not invest in precious metals such as gold.

If you want to invest in companies in the mining industry (not just companies that mine gold), then you could consider the very volatile Vanguard Precious Metals and Mining Fund (VPMGX), which we had invested in for about 7 years.
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Re: Is anyone putting money aside into Gold?

Post by nisiprius » Sat Dec 16, 2017 12:15 pm

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
No. But I don't understand why you are mentioning "gold" and "gold mining companies" in the same breath, as I believe both gold advocates and gold skeptics agree that these are completely different kinds of investment with almost nothing in common.

The blue curve below is the growth chart for VGPMX, a Vanguard mutual fund that invests in the stocks of companies in gold- and other precious-metal-related businesses. Orange is the chart for GLD, an exchanged-traded investment trust that actually invests in gold bullion. PortfolioVisualizer is showing a correlation of 0.48.

It's easy to make an assumption that if gold itself does well, that all gold-related businesses stocks will automatically do well, too.

You want to be really clear on which you want to invest in. In the case of gold mining companies, you want to be really clear on why you want to concentrate a lot of your stock investments into such a narrow business.

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 12:35 pm

nisiprius wrote:
Sat Dec 16, 2017 12:15 pm
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
No. But I don't understand why you are mentioning "gold" and "gold mining companies" in the same breath, as I believe both gold advocates and gold skeptics agree that these are completely different kinds of investment with almost nothing in common.

The blue curve below is the growth chart for VGPMX, a Vanguard mutual fund that invests in the stocks of companies in gold- and other precious-metal-related businesses. Orange is the chart for GLD, an exchanged-traded investment trust that actually invests in gold bullion. PortfolioVisualizer is showing a correlation of 0.48.

It's easy to make an assumption that if gold itself does well, that all gold-related businesses stocks will automatically do well, too.

You want to be really clear on which you want to invest in. In the case of gold mining companies, you want to be really clear on why you want to concentrate a lot of your stock investments into such a narrow business.

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Re: Is anyone putting money aside into Gold?

Post by surfstar » Sat Dec 16, 2017 12:45 pm

I keep my gold and bitcoin allocations equal...

0%

DanMahowny
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Re: Is anyone putting money aside into Gold?

Post by DanMahowny » Sat Dec 16, 2017 12:54 pm

I own gold.

I own it to protect significant cash holdings from hyperinflation, not because I think gold is a good investment.

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Re: Is anyone putting money aside into Gold?

Post by Nate79 » Sat Dec 16, 2017 1:26 pm

Nope.

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Re: Is anyone putting money aside into Gold?

Post by tigermilk » Sat Dec 16, 2017 1:31 pm

Only if my wife wants some on her finger, around her wrist, around her neck, or in her ears.

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Re: Is anyone putting money aside into Gold?

Post by JBTX » Sat Dec 16, 2017 1:46 pm

technovelist wrote:
Sat Dec 16, 2017 11:21 am
uberational44 wrote:
Sat Dec 16, 2017 10:52 am
diy60 wrote:
Sat Dec 16, 2017 10:46 am
uberational44 wrote:
Sat Dec 16, 2017 10:21 am
technovelist wrote:
Sat Dec 16, 2017 10:17 am


I have had a fairly high proportion of my savings in gold since the 1970's.

In my opinion, gold mining stocks are for masochists.

I think physical gold is reasonably priced at present. However, I always keep a significant amount regardless of the price.
You may not be wrong about masochism! I am young though, so I can recover if things go pear-shaped..

I agree with you on the price as well
I remember the euphoria in the office around 1979, gold was spiking at $800/oz. Some colleagues bought gold coins that included additional markup. Today 40 years later gold is $1200/oz, how pathetic is that !

I bought gold mining stocks in 1985 or so, I thought it was a good hedge against a big market drop. My mining stocks dropped like a rock just like the rest of my investments in the crash of '87.

I learned my lesson decades ago.
I'm not surprised!

I see buying gold as the opposite of the famous warren buffett quote:

Be greedy when others are unfearful


If you had bought in the early 1970s, the returns would have been serious!

http://static5.businessinsider.com/imag ... g?maxX=590


Gold mining is a strange one... they can go up, or down after a market crash. I have strong conviction that gold is under-valued, so willing to withstand a little volatility. I think :D
The problem is that gold mining is not the same as gold owning.

The miners can have many problems that don't affect physical gold, mostly due to politics in the (mostly undeveloped) countries where most of the mining is done. But there are many other issues as well, including fuel costs, weather/transport problems, and unions. There have also been a number of fraudulent companies in this sector.
I have a very modest amount in gold and silver ETFs. Not enough to make a difference either way. I used to own Vanguard precious metals which is mining stocks but dumped it. I had read that these companies are often poorly run and referenced some of the issues you mentioned. Precious Metal mining stocks are often valued at the potential of what they could mine from their assets but often show poor returns because they are poorly run thus they are arguably often overvalued.

Helo80
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Re: Is anyone putting money aside into Gold?

Post by Helo80 » Sat Dec 16, 2017 1:56 pm

Looking at historical returns of gold, it's a terrible investment. While true, it has always been worth something and was recognized for its beauty and rarity since before the Egyptians, it's not something that provides practical value in today's digital world. Virtually no merchant out there will accept gold as a form of payment. Sure, some electronics and art pieces, and other stuff requires gold to make, but by in large, nearly all of us live a gold-free life. If a gold bullion brick showed up on my doorstep, how would I monetize it? (Yes, there is a market for it somewhere, but the point is, it's dang inconvenient; While gold is likely classified as a very liquid asset, it's not THAT liquid to most of us.)

To me, the doomsday scenarios that TV says and how we should be investing in gold for those reasons --- I think fuel, bullets, guns, food, and other commodities would be worth more than gold. (again, because gold does not run your car, protect you, hunt food for you, make your belly full, etc.)

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 4:33 pm

Helo80 wrote:
Sat Dec 16, 2017 1:56 pm
Looking at historical returns of gold, it's a terrible investment. While true, it has always been worth something and was recognized for its beauty and rarity since before the Egyptians, it's not something that provides practical value in today's digital world. Virtually no merchant out there will accept gold as a form of payment. Sure, some electronics and art pieces, and other stuff requires gold to make, but by in large, nearly all of us live a gold-free life. If a gold bullion brick showed up on my doorstep, how would I monetize it? (Yes, there is a market for it somewhere, but the point is, it's dang inconvenient; While gold is likely classified as a very liquid asset, it's not THAT liquid to most of us.)
If that happens, be very careful how you pick it up. A standard bar that looks like a brick weighs about 28 pounds. :D
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Re: Is anyone putting money aside into Gold?

Post by MrDogg » Sat Dec 16, 2017 4:38 pm

Mohamed Aly El-Erian, chief economic adviser at Allianz, the corporate parent of PIMCO where he served as CEO and co-chief investment officer (2007-2014). He served as chair of President Obama's Global Development Council (2012-17), and is a columnist for Bloomberg View, and a contributing editor to the Financial Times says your investment portfolio should have at least 5% Gold.

Warren Buffet says 0% Gold.

3FP says 0% Gold

I agree with Buffett and 3FP so I don't have any gold.

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TheTimeLord
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Re: Is anyone putting money aside into Gold?

Post by TheTimeLord » Sat Dec 16, 2017 4:51 pm

Helo80 wrote:
Sat Dec 16, 2017 1:56 pm
Looking at historical returns of gold, it's a terrible investment. While true, it has always been worth something and was recognized for its beauty and rarity since before the Egyptians, it's not something that provides practical value in today's digital world. Virtually no merchant out there will accept gold as a form of payment. Sure, some electronics and art pieces, and other stuff requires gold to make, but by in large, nearly all of us live a gold-free life. If a gold bullion brick showed up on my doorstep, how would I monetize it? (Yes, there is a market for it somewhere, but the point is, it's dang inconvenient; While gold is likely classified as a very liquid asset, it's not THAT liquid to most of us.)

To me, the doomsday scenarios that TV says and how we should be investing in gold for those reasons --- I think fuel, bullets, guns, food, and other commodities would be worth more than gold. (again, because gold does not run your car, protect you, hunt food for you, make your belly full, etc.)
Gold is not for a doomsday scenario, gold is a value store in case of a disaster befalling your local currency, think Argentina. There is something like 1 mined ounce of gold per person in the world so it would be useless as a day to day currency after a doomsday scenario. And remember governments still have huge gold reserves that would not be available to the public.
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 5:03 pm

TheTimeLord wrote:
Sat Dec 16, 2017 4:51 pm
Helo80 wrote:
Sat Dec 16, 2017 1:56 pm
Looking at historical returns of gold, it's a terrible investment. While true, it has always been worth something and was recognized for its beauty and rarity since before the Egyptians, it's not something that provides practical value in today's digital world. Virtually no merchant out there will accept gold as a form of payment. Sure, some electronics and art pieces, and other stuff requires gold to make, but by in large, nearly all of us live a gold-free life. If a gold bullion brick showed up on my doorstep, how would I monetize it? (Yes, there is a market for it somewhere, but the point is, it's dang inconvenient; While gold is likely classified as a very liquid asset, it's not THAT liquid to most of us.)

To me, the doomsday scenarios that TV says and how we should be investing in gold for those reasons --- I think fuel, bullets, guns, food, and other commodities would be worth more than gold. (again, because gold does not run your car, protect you, hunt food for you, make your belly full, etc.)
Gold is not for a doomsday scenario, gold is a value store in case of a disaster befalling your local currency, think Argentina. There is something like 1 mined ounce of gold per person in the world so it would be useless as a day to day currency after a doomsday scenario. And remember governments still have huge gold reserves that would not be available to the public.
Agreed. 90% silver dimes and quarters are far more appropriate for such an admittedly unlikely scenario.
In theory, theory and practice are identical. In practice, they often differ.

john4546
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Re: Is anyone putting money aside into Gold?

Post by john4546 » Sat Dec 16, 2017 5:08 pm

Nope.

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Re: Is anyone putting money aside into Gold?

Post by retiredjg » Sat Dec 16, 2017 5:09 pm

No. :happy

OnTrack
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Re: Is anyone putting money aside into Gold?

Post by OnTrack » Sat Dec 16, 2017 6:24 pm

Be aware that physical gold (such as coins as well as ETFs that hold physical gold) have long term capital gains taxed as collectibles at your ordinary tax rate with a cap of 28% and not the 0%, 15% or 20% long term capital gains rates. Capital gains of gold mining stocks are taxed the same as other stocks.

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 6:28 pm

OnTrack wrote:
Sat Dec 16, 2017 6:24 pm
Be aware that physical gold (such as coins as well as ETFs that hold physical gold) have long term capital gains taxed as collectibles at your ordinary tax rate with a cap of 28% and not the 0%, 15% or 20% long term capital gains rates. Capital gains of gold mining stocks are taxed the same as other stocks.
Yes, I think that has already been mentioned.

However, collectible rate capital gains can be offset by capital losses, whether on collectibles or "normal" assets, which isn't true of ordinary income.

So if you have any significant amount of unrealized capital losses, you probably won't have to worry too much about paying a lot of taxes at the collectible rate.
In theory, theory and practice are identical. In practice, they often differ.

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Re: Is anyone putting money aside into Gold?

Post by hicabob » Sat Dec 16, 2017 6:41 pm

surfstar wrote:
Sat Dec 16, 2017 12:45 pm
I keep my gold and bitcoin allocations equal...

0%
Bitcoin has indeed been a great investment recently, unlike gold, but I think the gold to bitcoin equivalency paradigm you sometimes see nowadays is rude to gold.

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Re: Is anyone putting money aside into Gold?

Post by UpperNwGuy » Sat Dec 16, 2017 7:19 pm

No gold for me.... ever!

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Re: Is anyone putting money aside into Gold?

Post by heyyou » Sat Dec 16, 2017 7:33 pm

I like "good enough" and the methods espoused here, have been more than good enough. Patience and diligent saving have worked far better than any of my striving for better returns.
Others are welcome to explore for whatever suits them.

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Re: Is anyone putting money aside into Gold?

Post by Jiu Jitsu Fighter » Sat Dec 16, 2017 7:37 pm

Gold here - target weight is 5% (roughly half physical, half in ETF - IAU for ease of rebalancing) although use wide trading bands. Not popular at all on this board as in anything that veers from the three-fund portfolio. You don't need Armageddon to benefit from ownership, but don't expect to get rich. Skip the miners. Most management is a POS, and they hedge the price of gold (always at the wrong time) which you don't want Also, I keep two years worth of living expenses in cash/CDs/Money Markets. Helps me sleep at night. Also allows for the rest of my portfolio to be extremely aggressive - basically Larry portfolio sans fixed income (unless you count the CDs that I keep in my two-year emergency fund).

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Re: Is anyone putting money aside into Gold?

Post by Mike Scott » Sat Dec 16, 2017 7:39 pm

Only in the form of jewelry.

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Re: Is anyone putting money aside into Gold?

Post by dwickenh » Sat Dec 16, 2017 7:53 pm

technovelist wrote:
Sat Dec 16, 2017 12:00 pm
dwickenh wrote:
Sat Dec 16, 2017 11:40 am
No Gold as I think Treasuries will do the same thing in a down market and they do pay some interest.
If interest rates ever go back up to anything resembling historically normal levels, Treasurys will get massacred, whereas gold may do very well.

Just look at the 1970's for an example of this.
I try not to live in the 70's, but it looks pretty good from 72 to now!


Portfolio 1
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Long Term Treasury 25.00%
US Stock
Market
Long Term
Treasury
25%
75%
Category Count
US Stock Market 75
Long Term Treasury 25
Portfolio 2
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Gold 25.00%
US Stock
Market
Gold
25%
75%
Category Count
US Stock Market 75
Gold 25
Portfolio Returns
Portfolio performance statistics
# Initial Balance Final Balance CAGR Stdev Best Year Worst Year Max. Drawdown Sharpe Ratio Sortino Ratio US Mkt Correlation
1 $10,000 $718,032 11.30% 11.84% 34.36% -22.15% -36.28% 0.59 0.87 0.97
2 $10,000 $568,509 10.65% 12.58% 51.54% -26.55% -36.61% 0.51 0.76 0.92
The market is the most efficient mechanism anywhere in the world for transferring wealth from impatient people to patient people.” | — Warren Buffett

technovelist
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 9:53 pm

dwickenh wrote:
Sat Dec 16, 2017 7:53 pm
technovelist wrote:
Sat Dec 16, 2017 12:00 pm
dwickenh wrote:
Sat Dec 16, 2017 11:40 am
No Gold as I think Treasuries will do the same thing in a down market and they do pay some interest.
If interest rates ever go back up to anything resembling historically normal levels, Treasurys will get massacred, whereas gold may do very well.

Just look at the 1970's for an example of this.
I try not to live in the 70's, but it looks pretty good from 72 to now!


Portfolio 1
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Long Term Treasury 25.00%
US Stock
Market
Long Term
Treasury
25%
75%
Category Count
US Stock Market 75
Long Term Treasury 25
Portfolio 2
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Gold 25.00%
US Stock
Market
Gold
25%
75%
Category Count
US Stock Market 75
Gold 25
Portfolio Returns
Portfolio performance statistics
# Initial Balance Final Balance CAGR Stdev Best Year Worst Year Max. Drawdown Sharpe Ratio Sortino Ratio US Mkt Correlation
1 $10,000 $718,032 11.30% 11.84% 34.36% -22.15% -36.28% 0.59 0.87 0.97
2 $10,000 $568,509 10.65% 12.58% 51.54% -26.55% -36.61% 0.51 0.76 0.92
Sure, after a long bull market in stocks anything that is stock-heavy will look good.

Try ending in 2010 and see what you get. :D
In theory, theory and practice are identical. In practice, they often differ.

Grt2bOutdoors
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Re: Is anyone putting money aside into Gold?

Post by Grt2bOutdoors » Sat Dec 16, 2017 10:09 pm

It doesn’t have any revenue, it offers no interest, no dividends. It’s only utility is one of an industrial nature or that of a shiny bauble that must be insured, protected and kept. In essence, not only must you pay to buy it, you continue to pay long after the initial purchase with no prospect of sharing in economic growth in the future. Does not meet my criteria for a suitable investment.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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dwickenh
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Re: Is anyone putting money aside into Gold?

Post by dwickenh » Sat Dec 16, 2017 10:30 pm

technovelist wrote:
Sat Dec 16, 2017 9:53 pm
dwickenh wrote:
Sat Dec 16, 2017 7:53 pm
technovelist wrote:
Sat Dec 16, 2017 12:00 pm
dwickenh wrote:
Sat Dec 16, 2017 11:40 am
No Gold as I think Treasuries will do the same thing in a down market and they do pay some interest.
If interest rates ever go back up to anything resembling historically normal levels, Treasurys will get massacred, whereas gold may do very well.

Just look at the 1970's for an example of this.
I try not to live in the 70's, but it looks pretty good from 72 to now!


Portfolio 1
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Long Term Treasury 25.00%
US Stock
Market
Long Term
Treasury
25%
75%
Category Count
US Stock Market 75
Long Term Treasury 25
Portfolio 2
Asset Class Allocation
Save asset allocation »
US Stock Market 75.00%
Gold 25.00%
US Stock
Market
Gold
25%
75%
Category Count
US Stock Market 75
Gold 25
Portfolio Returns
Portfolio performance statistics
# Initial Balance Final Balance CAGR Stdev Best Year Worst Year Max. Drawdown Sharpe Ratio Sortino Ratio US Mkt Correlation
1 $10,000 $718,032 11.30% 11.84% 34.36% -22.15% -36.28% 0.59 0.87 0.97
2 $10,000 $568,509 10.65% 12.58% 51.54% -26.55% -36.61% 0.51 0.76 0.92
Sure, after a long bull market in stocks anything that is stock-heavy will look good.

Try ending in 2010 and see what you get. :D
Well the bull market was applied to both portfolios, so I don't see your point.

Sounds like cherry picking to me. If you like gold, fine. The history does not support your feelings, but to each his own.

We could both be wrong going forward.

Best of luck to you,

Dan
The market is the most efficient mechanism anywhere in the world for transferring wealth from impatient people to patient people.” | — Warren Buffett

technovelist
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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sat Dec 16, 2017 10:42 pm

dwickenh wrote:
Sat Dec 16, 2017 10:30 pm

Well the bull market was applied to both portfolios, so I don't see your point.

Sounds like cherry picking to me. If you like gold, fine. The history does not support your feelings, but to each his own.

We could both be wrong going forward.

Best of luck to you,

Dan
Same to you! :sharebeer
In theory, theory and practice are identical. In practice, they often differ.

JD
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Re: Is anyone putting money aside into Gold?

Post by JD » Sat Dec 16, 2017 10:56 pm

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
I did after the market crash in 2008. I made a lot of search but finally decided against the idea.

TheHouse7
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Re: Is anyone putting money aside into Gold?

Post by TheHouse7 » Sun Dec 17, 2017 2:37 am

uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
Honestly, the time I've put into investing in gold has only lead me to sales people. This had made me more than suspicious. :twisted:

(plug in fear mongering youtube video here)
"PSX will always go up 20%, why invest in anything else?!" -Father-in-law early retired.

1nv35t
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Re: Is anyone putting money aside into Gold?

Post by 1nv35t » Sun Dec 17, 2017 7:04 am

diy60 wrote:
Sat Dec 16, 2017 10:46 am
I remember the euphoria in the office around 1979, gold was spiking at $800/oz. Some colleagues bought gold coins that included additional markup. Today 40 years later gold is $1200/oz, how pathetic is that !

I bought gold mining stocks in 1985 or so, I thought it was a good hedge against a big market drop. My mining stocks dropped like a rock just like the rest of my investments in the crash of '87.

I learned my lesson decades ago.
Gold is one extreme, pretty much directly opposite to stocks. 50/50 barbell of the two is more of a centralised bullet. Avoiding looking at individual assets (most stocks for instance lag the broader average), but rather looking at the portfolio wide situation, and 75/25 stock/gold compared to 50/50 stock/bonds (a oft cited 'appropriate' asset allocation that has traversed periods of economic expansion and contraction relatively well) and ... https://tinyurl.com/yd3mvskz the two were broadly quite similar in reward, but 75/25 stock/gold was endured a bumpier ride along the way. For some who might pay relatively high taxes on regular income streams, the likes of BRK_A and gold and tolerating a bumpier ride could warrant alleviation of the taxes that might be paid when holding regular/ongoing income producing stocks and bonds.

Valuethinker
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Re: Is anyone putting money aside into Gold?

Post by Valuethinker » Sun Dec 17, 2017 8:14 am

TheHouse7 wrote:
Sun Dec 17, 2017 2:37 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
Honestly, the time I've put into investing in gold has only lead me to sales people. This had made me more than suspicious. :twisted:

(plug in fear mongering youtube video here)
Wise. But it's a bit out of favour, and the "background radiation" of political and international geopolitical risk keeps rising, and the market keeps ignoring it. That, and various incipient bubbles in valuation.

So. Vanguard has a Precious Metals and Minerals mining stock fund. That may be interesting-- although the correlation between PM prices and the performance of that fund is not that good. Central Fund of Canada is a fund that holds both equities and the metal gold itself.

The problem with gold miners (see Jared Diamond - Collapse for some arch commentary) is that if mining companies attract a cowboy mentality, then gold miners attract the real outlaw mentality among cowboys. Partly because the refining of gold (at the mine site) requires very serious environmental contamination with hideous consequences for locals, those downstream etc. (it's as bad as Alberta tar sands in that regard). And because gold is then this dense, high value metal which is often used in paying off government officials, local inspectors etc-- to get the mining license and then to operate. And new gold reserves are mostly mined in frontier areas with very poor vulnerable local populaces, vulnerable ecosystems etc.

From an investor point of view the companies are shockingly badly managed in many cases. Fraud, malfeasance, disregard of shareholder value etc.
That was particularly true of Barrick (poor shareholder value) but they have had a change in management.

The world's gold equity investors are centred in London, UK (there's a pub in the West End that the promoters and investors all drink at), and it has to be said they can be a spivvy bunch, or at least the promoters.

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Re: Is anyone putting money aside into Gold?

Post by technovelist » Sun Dec 17, 2017 8:24 am

Valuethinker wrote:
Sun Dec 17, 2017 8:14 am
TheHouse7 wrote:
Sun Dec 17, 2017 2:37 am
uberational44 wrote:
Sat Dec 16, 2017 9:50 am
I have been taking great interest in gold recently and gold mining companies...

Has anyone else considered this?
Honestly, the time I've put into investing in gold has only lead me to sales people. This had made me more than suspicious. :twisted:

(plug in fear mongering youtube video here)
Wise. But it's a bit out of favour, and the "background radiation" of political and international geopolitical risk keeps rising, and the market keeps ignoring it. That, and various incipient bubbles in valuation.

So. Vanguard has a Precious Metals and Minerals mining stock fund. That may be interesting-- although the correlation between PM prices and the performance of that fund is not that good. Central Fund of Canada is a fund that holds both equities and the metal gold itself.
I have owned Central Fund (CEF) for quite a long time, just disposing of it this year. It does not hold equities. Its holdings consist almost entirely of gold and silver, with a little cash to pay their tiny dividend.

It has the advantage over most precious metals investments of being taxed as a "normal" stock, not as a collectible.

The reason I got rid of it was that it was the target of a takeover by a company that I don't like. It also requires filing a complicated and annoying tax form every year.
In theory, theory and practice are identical. In practice, they often differ.

gvsucavie03
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Re: Is anyone putting money aside into Gold?

Post by gvsucavie03 » Sun Dec 17, 2017 8:44 am

No. :happy

workerbeeengineer
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Re: Is anyone putting money aside into Gold?

Post by workerbeeengineer » Sun Dec 17, 2017 11:02 am

We have a very modest amount of money in a golf mining companies stock ETF. Probably a waste of capital on our part. Even if it zags when the rest of the portfolio zigs the amount is not enough to be a meaningful hedge. Increasing the amount so as to be meaningful is too risky in our view, so back to being a waste. Hmmm....time to rethink :confused

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