Do you guys think that buying gold is a good option in terms of an investment? Do you guys buy physical gold or gold etfs? #personalfinance #investments #gold
Over most of the last hundred years, gold was a poor investment vs equities like stocks. Buy VTI every two weeks and forget about it. https://www.macrotrends.net/2608/gold-price-vs-stock-market-100-year-chart
Hmm 🤔 let’s check the past 48 year return on gold compared to US stocks.
Shiny things had more value when we had to explain everything with deities. From a practical standpoint, there are no weddings in India for the next few months, so demand will be down.
Gold is for the hard times and not the best long term term investment if the goal is growth. It's a super hedge when the bottom falls out of the economy or if it gets into hyperinflation. It's like insurance - you don't put a value on it as investment alone and you hope you don't need it. The spot prices - are manipulated by bankers in London, Chicago, and NY, not by the free market. If you look at any bullion dealer's website, there's a high premium (spike) over spot, indicating real prices. If you try to sell gold, you will be quoted spot prices! ETFs have maintenance costs that drain your returns by increasing your cost basis. That's not good for long term investment either, and they do worse than physical gold. And until they are audited, you don't know if they actually have the gold to back each share or not. You can see the gap between GLD (1 unit = 1/10 oz), spot price, and the real dealer price with premium. There's a big gap in each of the above while, in principle, they should be very close to each other.
Gold should be a part of your portfolio. The best is to own physical gold stores outside of the banking system. Although that is not always practical, especially now when you can’t really get it. A decent alternative would be physical gold funds (not GLD) that hold allocated bullion. I like the Sprott Gold Fund.
If GLD collapse, it means a serious liquidity problem with physical gold. Owning physical gold won't do you any good if you can't sell it or exchange it for other things. If that ever happens, you should own guns in addition to physical gold.
Bitcoin’s recent price drops have not been any more painful than those of gold or stocks. In fact, the U.S. stock market has now returned to 2015 levels, whereas Bitcoin is exponentially more valuable. The stock market, as represented by the Dow Jones and S&P 500, has lost much of its value. Gold, the traditional safe haven, is up 25%. Bitcoin, on the other hand, is up 35% since this time last year and appears ready for a major breakout. My take I'd leave it a wise choice to have at least 5% in investment in Bitcoin :)
Dow priced in gold chart indicates stocks resume bear market when priced in gold. This can happen two ways: stocks fall, or gold goes up or both or a combo. www.kondratieffwave.com
There’s an outlook (or rumour) for pricing GLD on 1800 /oz. but there are strong sell actions above the 1650 levels. According to the “rumours” it should have gone up already. Waiting if there will be a break through.
It was over 1700 last night
GLD
Careful...will comment below
Thank you. Good call outs. I’m aware of risks you listed. For me, GLD is stil better option. The price difference is due to overhead since the ETF started back in 90s. At that time, prices were comparable and over time started deviating due overheads associated with managing gold and ETF. Having said that, managing physical gold on your own comes with its own overheads. Buying and liquidating is hard, overheads with securing etc. Considering overheads, I’m comfortable with ETFs over physical gold. Regarding timing, if market continues to drop, gold is expected to follow. Everyone will start liquidating to cover for margins.