Jackbrown there is no rule that says you have to hold the same shares forever. Index funds don't hold the same shares as you have aptly pointed out and neither should individual investors (with some exceptions e.g. Coca-Cola type companies) If you hold shares in a company at its prospects start to deteriorate significantly you should probably sell out rather than holding on and praying, hence a savvy investor would not have been wiped out during the depression. Ben Graham suffered huge losses during the depression but eventually recovered and provided his investors with good returns.
There is nothing wrong with good trustworthy pm companies, I have my game plan, and im preparing for this dooms day - but im headged enough just incase some remnant of the market survives - which I believe it will. Im not a uniformatarian, im a realist and a Christian - so dont go quoting Bible verses at me - say what you want to say without misquoting the Bible. I am not missing the oppertunities - and ill be taking profits on the way up so a low percentage of my capital will be at risk in the long run. Wait till the energy crisis hits, and there is a war breaking out in the world AND there is a debt default - i know whats comming and I dont agree with that the markets will be destroyed. Nor do I listen to over simplistic rationales of doom. If you really believed that you would be investing in food & water storage not just PMs. So unless you are doing that seriously - I dont want to hear it. Put your money where your mouth is. Nobody knows whats going to happen... cept God
I have some pm shares and do not mind admitting, that at the moment, they are getting slaughtered. Not tempted to sell at the moment, I believe a lot of it is carry over from the fall in spot prices. As with any investment do not invest what you cannot afford to lose.
All good points BH, all true. But I ask why play a market that has obviously entered a secular bear? You are sailing against the current not with it and the chances of losses are increased. I think buying shares at the bottom is smart but if picking bottoms was easy and switching in and out of different shares free then everyone would be rich. When I see that in 2011 I have to add that data to an overwhelming set that tells me equity markets are due to plunge. But how far? This current equity market began as a bull in 1980 and entered the bear phase in 2000. What we have seen since is nothing more than bumps on the way back down I believe. The chart I posted above is somewhat deceptive unfortunately. The peak in 2000 was at 3000 points and in 2007 was a bit over double that. This does not account for REAL inflation, which would make the graph look a lot flatter. Aside from the housing bubble we had very little inflation in the 80's and 90's. Oil, food, electricity, water, they all remained tame. All the gains people thought they had made in the 2000's were really illusionary. If they wanted to take their share money and pay their power bill, their food bill, pay their insurance, etc etc, they would soon realize that their shares had done little more than keep up with inflation. The real bad news though is that those imaginary gains are taxable, which would leave them with a net loss, for the average investor. And that is behind the psychology of buy and hold with these instruments, it traps people in the market. Trading in and out will see gains if you can pick but you can make money that way only for so long. Shares are no different then houses or Gold in this regard. When the tide turns you will make a lot more in a different market with very little risk. Be diversified? What and lose money on 2 investments and hope the gains on the third class makes up for it. I have said it before here, that is the strategy touted by all the talking heads on television. It's just another lie to keep you in falling markets and playing it safe that way lose you money every time. The secret to successful long term investing is always through long term trends, and our PMs are still the long term trend. We have 11 years of gains, and this last "no one is looking dump the paper" correction, has only pulled prices back 1 year out of those 11. Soon it will be time to sell out of PMs but very few will get out in time. They will be too caught up in the hype and "wealth effect" and will ride the bear down.
Jack Brown - your version of diversification is faulty. You have misrepresented it (or created a straw man fallacy) - Diversification is like headging - its not just buying what goes down when the one you really like goes up.
Diversification, as the mainstream media presents it, as nearly all financial advisers present it, as Kevin Rudd presented it in an interview just post the beginning of the GFC has one aim. To separate you from your money Sanchez. If you were were diversified in shares, US housing and gold bullion in late 2008 you would have seen a triple hit to your wealth. The gold would have recovered it losses and gone onto new highs but your other 2 classes would have and still are, well down on what they were. You and I will never be truly wealthy Sanchez, not as the likes of Jim Rodgers are wealthy but we can copy them and protect the money that we have worked hard for. Diversification as you define it is for lazy fearful people who don't trust their own judgement, or for people who are dumb but think they are smart . Basically they have had an idea rammed down their throats year after year and then once converted walk around as though they are geniuses and thought it up themselves. Everyone out there believes in your brand of diversification, that is one reason I'm sure it will fail, because the herd always loses. To reply to your post above specifically though sanchez let me say that I am diversified, but in money only. Gold silver and cash, and for the last 8 years my diversification has proved vastly superior to that of the tv pundits. Will gold and silver be a bad place to have your savings one day? Of course, but if I keep my eye on the ball I will be gone from them long before they reach the inflation adjusted average price I paid for them. Then I will buy a cheap asset class, possibly farmland here if it has collapsed in price. Straw man fallacy? I created no illusion and attacked it, I clearly refuted your position as stated below. You are diversifying into the share market, that is your choice, I simply state that this form of diversification has cost people a lot of money in the last 10 years. Did you read the piece about how the Mediterraneans are diversifying a lot of their wealth into the swiss franc and the Australian dollar? This is fear based diversification but it far superior than diversifying into aussie shares, local RE and all the other paper assets about. This global paper asset system is collapsing, Blind Freddy can see that.
I still think you have a limited definition of diversification I really just means buying a veriety of things that are not linked.... Currency swaps arent really a diversification because its all connected owning bulk physical food, physical bullion, some cash, a good water purifier and a stock of common medication would be wise in the crash world people are scared of.
I didn't want to create a seperate topic Its got nothing to do with silver. but this share.i bought CGP is going up like a rocket, percentagewise. Once again I didn't do any financials research, I scoured around for gossip using google. Fun one to have, everytime I check its gone up.
I dont like playing that gambling game, im interested in profit and diligence not whims, fads, whispers and hearsay
Roman - just in case you are interested - here is a write up of CGP http://www.buysellsignals.com/10211006
If i sell today I'll make a decent profit. Which means it wasn't a gamble it was a sound investment, Its only a gamble when you lose.
Thanks for that info sanchez. I probably should've checked those things before I bought it. But it does say its a 5 out of 5 short term buy with alot of bullish signals , whatever their opinion is worth. So I'll ride the rollercoaster a while longer and hope it keeps going up. CGP 4.5 cents today 10 cents by next Friday is my prediction . I just hope I'm not underestimating its potential
Thats the issue IMO with these types of buys - there is no real exit strategy. My brain just doesnt work that way - I dont like taking those types of risks. Im not a trader - I research fundamentals for stock picks and chart patterns for entry points - but the fundamentals are my reason to buy and hold. Volitility creates fantastic oppertunities for someone like me as well as someone who trades... Here is a good example of how things can go wrong quickly [youtube]http://www.youtube.com/watch?v=uubsFZMOPYQ[/youtube]
Sorry, but I'm new to the whole share trading game. I don't understand how CGP is posting these enormous percentage increases. Can anyone help me out? Is it purely hype or is there something actually there? Cheers
Good question dealmaker. I suspect word has got out that I bought them and the bigboys have wisely followed suit
I got out today at .042 before i became a gambler. So far thats 2 stocks I've tipped which dropped as soon as I mentioned them here. KRM are still in the doldrums. Stay tuned for number 3. This time for sure
Had some very nice buys over the last few days, One I wanted to mention was Phillips River Mining (PRH) (previously tectonic resources) Just under 1m ounces Tight capital structure Large holdings of land Future growth through aluvial gold deposit (pannable type of gold = v low cost) Good managment Looking at Hydro power for energy needs Undervalued (very) at 21c picked up for 17.5c with a stink bid and a seller (who obviously didnt know what he/she had) sold to me. Lesson: know what you have purchased and why or else you will sell it to someone who knows better I would have paid 20cps for this stock and been happy I hear read people on here and it seems like people really dont have a plan but buy on some flimsy basis like 'its only 4c' or 'I got a tip from some dude' - or usually its just the stock isnt going up as fast as you want it and you let your emotions get in the way.
KRM (excluding and speculation on dividend yeilds) is over valued currently (IMHO) BUT - if you believe the gold story - that (only) should not be a reason to sell a bad possition in a bull market is unfortunate for a time, but its like the red sky at night... good weather will come in the morning.... excluding a black swan... What i said above might make me sound proud - im not trying to be - ive just eaten crap enough times to be on the allert and skeptical.
Arafura ran up 25% today off the back of producing first product samples for customers. Bannerman up 20% since originally posted
