Hi mates, for all who stack both Au and Ag .... after playing with some #'s i finaly decided to use the following formula when i'm stacking silver and gold. My "GSR-aim" have change so much over the last couple of months, 1st. i want to be 50:1 (Ag:Au), then 40:1, then as near as the current GSR is. We all know there's 32.15 oz in 1 kg, wich means 32.15 oz in 1000g. A 1000/32.15 = 31.104 ... and there it is =) For every gram of Au i'm stacking i want an oz of Ag. Now it's very easy to know howmuch Ag/Au i short at any given time. I'm only a middle-class incommer and my target is to have at the end of my stacking-career 1kg Au and 1000oz Ag. I'm now at 37.5% of my target, thats the good news, BUT the bad news is it will take me another 10 years to get to 1kg Au and 1000oz Ag, it's a growing-rate of 2oz Au and 62oz Ag per year ... thats alotof overtime and scrapgold selling to do. What's good for me with this formula is that silver will always be cheap for me as long as the GSR stays above 31.1. I find it very dificalt to stack silver every month cause there's almost no silver here to buy ... i wait about 4 months then order from Aus or USA. Any thoughts, what formula does the mates on here use ??
I like the sound of your formula. I might do some calculations of my own based on it and see what my stack is like. I know I currently have an almost 50/50 split between gold and silver in $$ terms.
I used to work purely on the GSR, but with the GSR dropping like a rock in recent times, I've actually moved towards Silver more at the moment because Silver is (compared to gold) well under priced. My theory is that you don't need to stack Gold so much at the moment, stack the underpriced silver and let the GSR machine generate your Gold for you. In other words, when the GSR reaches a point you are satisfied with, swap your silver for gold. I will ALWAYS have some position in Silver, even after it's inevitable rise to the moon. Probably even just 10%, but something. The rest I will trade for Gold at as low a GSR as I can get. Whilst Silver is the place to be right now IMHO, very long term for me it's always about the Gold. Gold. Gold. Gold. I want Gold. [youtube]http://www.youtube.com/watch?v=nO4I-Rf7rrw[/youtube]
I'd agree with Aus. I've been focusing on silver of late to try to maximise any gains received when the price truely reflects a non-manipulated market. On the formula above i need to double my gold holdings atm. Gold i tend to buy occasionally when i 'feel the need' for balance, have some spare cash, or simply see something i like or is a good deal.
Interesting you should say this - as the GSR is currently the lowest it's been since 1983, which makes it look OVERVALUED to me compared to gold. Personally I think both metals are undervalued in fiat, but I would not say silver is undervalued compared to gold - although I don't doubt that the GSR will head lower.
I think the GSR gap will tighten further still GP. I think Silver is very much still grossly undervalued in this market, but Gold isn't THAT far off fair market price. Certainly not in the same realm as Silver in any case. Whilst I can definitely see a continuing trend in rises for both metals, there's no denying Gold has plateaued a bit catching it's breath whilst silver races to catch up. Will we see 30:1 by year end? Definitely a possibility if Gold continues it's current trend to tread water and Silver stares down $50...
Yep I think you guys are right, the GSR has been steadily declining, it would be crazy if we got into the 30's this year
