Gold or gold stocks?

[noirua]

21 February 2021

 

[Bik]

Gold stocks can give you some good leverage to rising gold prices and you don't have to worry about the currency effect of buying and holding gold. If you wanted to reduce risk and buy a basket of Aussie Gold Producers, you could buy an ETF such as GDX or MNRS. Otherwise you could buy individual gold producers or explorers but then you have increased risk that the company has issues and you don't profit from a rising gold price (if the price does rise).

I talk about ways to profit from Gold and Silver in this video:

 

[noirua]

Is gold set to tear even higher? Four key charts to watch

Bullion is one of the best-performing commodities this month, erasing almost all of this year’s losses.

www.mining.com

 

[noirua]

July 9, 2021

 

[divs4ever]

Thanks fellas the problem is this -
Money in the bank is useless.
Bank offered me .11% so I just placed it back in a TD for 14 days till I decide what to do.
I'm burning capital every time I shop.
I'm retired no income but asset ok, but don't qualify for any benefits.
I either buy gold and hope it goes up then take the profit along the way or find a dividend stock that I can rely on.

this is NOT financial advice , just what i am doing currently

( i hold other stocks but this is what i am doing in the last two months )

i am looking for reasonably priced gold-producer stocks ( that pay dividends and some gold producers don't or are very sporadic ) but not ignoring div-paying miners of iron , copper etc etc , but the goldies seem to be left behind currently , and they are getting the bulk of the spending

if i did plump for gold , i would take physical possession of it ( under the floorboard or mattress ) but that leaves you a security issue , if times get tough there will be more people stealing , i see gold as a value marker and would probably NOT sell it , but maybe swap it when you really need some ready , say buying a house or weekender , etc etc

i agree money in the bank is basically eroding in value , but heck i am finding it hard to find sensible places to invest it

i am sad to say i can't think of an easy solution for me , so what chance have i got picking a winning strategy for you

good luck

 

[againsthegrain]

The non 4 big banks offer a much higher rate at the moment. For example amp offers 1.25% opposed to anz at 0.25%

 

[divs4ever]

1.25% ... yes but what is the real inflation rate , the RBA is hoping for 2% and some folks think it is double that or more

and outside the Government bank guarantee , there is clearly risk

in 2011 to 2016 i was dabbling in corporate hybrids ( including MQG and Heritage Bank ) at the current offerings i rarely even look there now let alone reach for the calculator

cheers

 

[noirua]

Gold Stocks versus the Gold Price – Talking Wealth Podcast: Stock Market Trading and Investing Education | Wealth Creation | Expert Share Market Analysis – Podcast

In this week's Talking Wealth podcast, Janine discusses how the gold price has performed and compares it to the volatility and movement of Newcrest Mining. She also shares a number of key points inves... – Listen to Gold Stocks versus the Gold Price by Talking Wealth Podcast: Stock Market...

podtail.com

 

[The Triangle]

this is NOT financial advice , just what i am doing currently

( i hold other stocks but this is what i am doing in the last two months )

i am looking for reasonably priced gold-producer stocks ( that pay dividends and some gold producers don't or are very sporadic ) but not ignoring div-paying miners of iron , copper etc etc , but the goldies seem to be left behind currently , and they are getting the bulk of the spending

if i did plump for gold , i would take physical possession of it ( under the floorboard or mattress ) but that leaves you a security issue , if times get tough there will be more people stealing , i see gold as a value marker and would probably NOT sell it , but maybe swap it when you really need some ready , say buying a house or weekender , etc etc

i agree money in the bank is basically eroding in value , but heck i am finding it hard to find sensible places to invest it

i am sad to say i can't think of an easy solution for me , so what chance have i got picking a winning strategy for you

good luck

Not sure of this fantasy world people live in where gold is a savior.... Who's ever made a fortune investing in physical gold? Maybe investing in junior explorers yes. But physical gold over the long-term?

If the economy collapses so badly that stocks and currency are worthless and people are breaking in to your house to steal your gold then that gold won't really be of much value anyways - and if Australia is in that bad a shape - chances are the rest of the world is in worse shape. Guns, ammo, alcohol, cigarettes, food, property - much better store of value in that case.

I would look at companies with the lowest AISC and highest resource/reserves as they probably can withstand price drops and have longevity.

 

[peter2]

My sympathies to all those holding gold stocks. Since the rally in the gold price 8 days ago it's been a volatile ride. Ouch.

 

[divs4ever]

Not sure of this fantasy world people live in where gold is a savior.... Who's ever made a fortune investing in physical gold? Maybe investing in junior explorers yes. But physical gold over the long-term?

If the economy collapses so badly that stocks and currency are worthless and people are breaking in to your house to steal your gold then that gold won't really be of much value anyways - and if Australia is in that bad a shape - chances are the rest of the world is in worse shape. Guns, ammo, alcohol, cigarettes, food, property - much better store of value in that case.

I would look at companies with the lowest AISC and highest resource/reserves as they probably can withstand price drops and have longevity.

i see gold as a lifeless inert metal and in the current world that is a GOOD thing , i see it as something you are likely to be able to barter when acquiring high value items , a property , a herd of cows , maybe a business to support your family , when you need it

but gold is also portable enough to transport if you really have to move ( assuming your hoard isn't many tonnes of it )

if gold has no value why do nation states seize it from citizens during war-time and other major financial collapses ( so you better hide your stash real good )

now i like gold producers as a compromise , some chance of a steady income , and inversely leveraged to the local currency ( you know that stuff printed up because some airline starts tearing up )

now i am slowly stock-piling honey ( and should really track down some recipes for mead ) so yes i can hear what you are saying but when the economy (officially) falls over this time what will it be like ... some clown salesman won't get this nation motivated you can bet on that .

ASIC isn't everything but it is a good number to start with on your research journey

 

[wayneL]

Not sure of this fantasy world people live in where gold is a savior.... Who's ever made a fortune investing in physical gold? Maybe investing in junior explorers yes. But physical gold over the long-term?

If the economy collapses so badly that stocks and currency are worthless and people are breaking in to your house to steal your gold then that gold won't really be of much value anyways - and if Australia is in that bad a shape - chances are the rest of the world is in worse shape. Guns, ammo, alcohol, cigarettes, food, property - much better store of value in that case.

I would look at companies with the lowest AISC and highest resource/reserves as they probably can withstand price drops and have longevity.

One Economist once described gold as like a zero coupon bond and almost all of the macro boys will have at least some physical gold in their portfolio.

Should one be 100% invested in gold?

I don't think so and neither do most hedge funds and macro guys. Most are somewhere between 5 and 25% and I must admit that due to capital gain and accumulation I'm creeping up to about that 25% myself.

At this stage of my life and given the precariousness of currencies and the banking system, I'm quite happy to keep my dry powder in that form.

And you bet your sweet ass that I have got at least 25% in what I call the wild west part of my portfolio is shooting for 10 baggers or something like that.

The rest at the moment I have applied a holy **** strap (riders of yang-yangs will know what I mean there )

 

[divs4ever]

i think George Gammon ( You-Tube property investor ) has a fair strategy
10% gold ( insurance ) , 80% income ( stuff that pays you while you own it ) and 10% speculative ( betting the price will go up , that includes cryptos , but not only cryptos )

well if you are self-sufficient on a farm , a heavy stash of gold MIGHT be good , but if you have to ineract with people ( and tax-addicted governments ) you will need something else ( with gold or silver as an emergency back-up )

if you need to interact with the outside world there is a thing called inflation ( the erosion of your buying power ) that can be a tough enemy to beat ( but governments love it because it helps make THEIR debt trivial )

my multi-baggers go up by themselves much to my surprise ( of course some other 'quality stocks' vanish into a black hole )

MQG is the only stock i have successfully predicted to double ( up 480% for me ) in the 10 years i have been investing .. if looking for tips .. others have a much better success rate ( my gift is saying WOW maybe i should take some money off the table , when it is rising or wallowing in limbo .. like AMP in 2018 or IPL as examples )

cheers

 

[The Triangle]

I just don't see any point of investing in physical gold or mature gold producers if you are living in a first world nation (unless you think it will go up enough to pull in a good capital gain over the short term). Maybe in Zimbabwe having a stash of gold is a good idea as it could get you on a people smuggling boat to Australia when the local currency collapsed or your shares in the local stock exchange went to zero.

If you wanted to invest in gold - you need to ask why? If it's to keep some value if humanity enters a post apocalyptic state - then I wouldn't go anywhere near gold producers, I'd buy a heap of little 5g bars from the mint. If its to speculate on the price going up - then I would be inclined to buy juniors who could benefit from that increase in price by turning a worthless resource in to a profitable resource - and then my little 5g bars as a second less risky choice. But buying shares of existing producers to me is just strange as the upside is usually somewhat limited and there is still risk of the company faltering through incompetent management and I thought the purpose of holding gold was generally to de-risk for most people.

Look at all the main gold miners - most are still at a lower SP now than they were when gold was $600/ounce. It's only been the ones who have grown from small players with marginal mines that have performed well. Once you get to a MC in the 10s of billions you just can't do much to grow bigger.

 

[divs4ever]

physical gold held VERY close to you might be useful in dire circumstances

unlike currency , now they are NOT paper , they are unless to feed a fire or for sanitary uses

if gold was useless in a crisis why have so many governments seized it in the past

i still prefer gold stocks and non-bullion gold

 

[wayneL]

physical gold held VERY close to you might be useful in dire circumstances

unlike currency , now they are NOT paper , they are unless to feed a fire or for sanitary uses

if gold was useless in a crisis why have so many governments seized it in the past

i still prefer gold stocks and non-bullion gold

The eternal debate.

Yep, hard to calve off a piece of your 1oz coin (now worth a trillion useless Pacific pesos) to buy a loaf if bread and a hand made machete (Which I can make... Ring me if the apocalypse happens)

But by the same token... A nuke in the stratosphere and none of us can access anything valued by fiat.

It'll be barter only...

So gold/silver, tins of baked beans, baseball bats and machetes will be the currency.

And maybe your humble farrier might be in demand

 

[divs4ever]

i was thinking more like gold for a house ( or a hut if you don't have much like me ) , your gold coin for some cows you could milk them or a dozen chickens

just because the system has imploded intelligence applied , will still have it's rewards

but barter and self-suffiency might be very valuable

 

[Value Collector]

physical gold held VERY close to you might be useful in dire circumstances

unlike currency , now they are NOT paper , they are unless to feed a fire or for sanitary uses

if gold was useless in a crisis why have so many governments seized it in the past

i still prefer gold stocks and non-bullion gold

I guess if you want to have an escape kit ready in the safe then having some gold, along with a fake passport and a stash a several different currencies might be useful, But in that situation it might be better to go with diamonds rather than gold, as they are easier to get through metal detectors without raising alarms bells.

 

[Value Collector]

It'll be barter only...

So gold/silver, tins of baked beans, baseball bats and machetes will be the currency.

And maybe your humble farrier might be in demand

I imagine that if their is a zombie apocalypse, I will probably die the first day. So I don't plan for apocalyptic events, I plan for the most likely rosy outcome.

 

[divs4ever]

having a little skill in the bush , i probably wouldn't move far ( miles more likely than states/nations ) , given the instability in many nations where would you go , most high volume routes are liable to be plagued by thieves and government officials

for a rough guide check out what happened to WW2 refugees in almost any theatre of the war , this time the soldiers might NOT be on your side and just as desperate as you