Need advice: Buy gold now or over time?

S

SuprmeLeadr

Member
I have ~15k AUD in bank and ~ 3k AUD and USD physical currency.

I don't want to have any cash on me besides the 3k above.

I have 3.5oz gold and 100oz silver, most of which I bough this year just after the big move in June/July.

I definitely want to get my money out of the bank, but I’m not sure what to buy with it.

Stocks = NO, way too overpriced and I think there will be a major crash before the 2020 election.

Bonds = NO, they have negative real rates

Super = NO, too regulated, rather have my own stock portfolio if I ever wanted to buy stocks in the future

Real estate = YES, eventually. Massive bubble now so ideally I’ll hold gold and wait until the crash and scoop up property at the bottom.

So my only option is gold and silver.

Do you guys think I should get move my bank into gold ASAP or spread it out over months/years to cost average my stack?
 
Cost averaging is always better, less risk. With big buys you can make greater profit but risk greater losses as well. Personally I would just buy what I can at close to spot off the forums on a weekly basis.
 
I've always just bought when I had the funds, so if you've the money on hand and you want gold then go for it.

I don't know any of your personal circumstances but I'd be hesitant to only have 3k on hand. Just my conservatism really.

I went through a stage of emptying my bank accounts in fear of a long dark night and bail-ins etc. What I learned was economies and ocean liners don't turn on a penny, and a bank account is pretty safe, all things considered.
 
^^^^^^ its good having a biggish chunk of precious metals and assets, but sadly you do need to keep a good chunk of fiat, just because its common for people to put all their money into assets, which seems like a good move however if something unforeseen happens you maybe forced to sell assets due to an unforeseen reason because you dont have the money on hand, the problem that can often face people having to sell assets like precious metals at the drop of the hat is you dont often get lucky enough to sell them at the right time, so you can lose money. So keep a good chunk of fiat for safety, dont put all your eggs in one basket. stacking fiat is not a bad idea as well.
 
wrcmad said:
Actually, dollar-cost-averaging as a strategy is a statistical dog. A load of bunk.
I have outlined why before on this forum, and it is yet to be refuted.
All-in or nothing, says the maths. :)
Click to expand...
You are absolutely correct, but only for those who are not lazy traders and can appropriately read charts and time their buys. For part timers like me, if I went all in in 2011 I'd still be at a loss. Those of us who can't trade have to rely on averaging out over time.
 
wrcmad said:
No, not for lazy traders.
For anyone.
It is non-committal, and sacrifices ROI for the psychological comfort of being able to always tell yourself you were right.
Click to expand...

I use a hybrid cost averaging strategy - don't know a better term. As in when the price is obviously cheap, I would buy a bigger batch and smaller bites when I feel that the price is high and it might correct. This would help with ROI while at the same time giving some comfort if the price plunges.

The difficult is how to know that the price is cheap. For example, is $900 platinum cheap?? It's easy to see it on hindhight after the price has jumped. We all know $1200 gold is cheap, but when gold was at $1200, people are talking about sub-$1k.
 
I like having a goal for a set % of your total assets in gold/silver/whatever. So when you have $$ put it in the asset class that is furthest under from your goal % if you don't have $$ then sell the asset that is most above. If you have all $$ then lump sum into your desired asset classes.
 
Yes, if i am on your position, will do it slowly overtime. Buying gold or silver is not an emergency unless there is a best deal. Meaning somebody is liquidating metals for an emergency. Having cash is always good in most cases.
 
JulieW said:
I've always just bought when I had the funds, so if you've the money on hand and you want gold then go for it.
Click to expand...

I'd say go for it too. You have decided to get it out of the bank, so get it out of the bank and buy metal.

I don't know any of your personal circumstances but I'd be hesitant to only have 3k on hand. Just my conservatism really.
Click to expand...

The solution to that is easy, get unallocated Perth Mint account and put in there. You can sell and have cash back the next day if needed.
You can also move the cash over and set automatic buy limits and then wait. Could do it in say $2k chunks or something.

I went through a stage of emptying my bank accounts in fear of a long dark night and bail-ins etc. What I learned was economies and ocean liners don't turn on a penny, and a bank account is pretty safe, all things considered.
Click to expand...

Agreed. If the fear is the bank collapsing or whatever, that is unfounded paranoia.
 
SilverDJ said:
Agreed. If the fear is the bank collapsing or whatever, that is unfounded paranoia.
Click to expand...

In the 2008 GFC, ANZ bank ATMs stopped working for a couple of days and people couldn't get their money out, some people thought they were insolvent if I remember things correctly.

SuprmeLeadr said:
Do you guys think I should get move my bank into gold ASAP or spread it out over months/years to cost average my stack?
Click to expand...

I don't believe in cost averaging nor buying everything at once but something between, you should try to buy when the prices are lower. I don't think holding gold is very good either because there is a lot of costs involved with buying and selling unless you do it through this site. I think Perth Mint unallocated gold is best, it's more liquid than physical gold, cost is 1% with a little spread and with the GoldPass you can transfer your Gold at no cost to other members so now you can make payments in gold. The Barring of Gold is expensive through the Perth Mint which is converting the unallocated to physical, but because you can use GoldPass there is no reason why someone would or would not want to swap you physical in exchange for GoldPass, I don't think this has ever happened before, I would like to see it.

SuprmeLeadr said:
I have ~15k AUD in bank and ~ 3k AUD and USD physical currency.

I don't want to have any cash on me besides the 3k above.
Click to expand...

You want to have Cash, I would keep 33%-50% in Cash so you can take advantage of opportunities when they arise, 25% in PMs and 25% in Gold mining companies. If you are up to it, you can earn between 2%-4.5% paid in gold by investing with a fund https://monetary-metals.com/

You want your savings working for you, but hoarding gold is the same as keeping money in a bank account, it's unimaginative and will hinder you and possibly wrong and bad thinking when you consider some philosophies, take for example The Parable of the Gold Coins which Jesus told when he was near Jerusalem, he told the story of a noble man whom left on a journey to become a king who gave a gold coin to each of his servants to entrust untill he returned. When he returned he summonsed his servants, the first one said he turned the gold coin into 10 gold coins, the man was pleased and gave him control of 10 cities. The second servant said he turned the gold coin into 5 gold coins, he was awarded 5 cities. The third servant still had the one gold coin, he said he went out and buried it so it couldn't be stolen. The man was very angry with him and said he can't be trusted with anything and took his gold coin and gave it to the man who had 10.

So you have to be active and try to grow your gold, the correct way to value your net worth is the gold value of your assets, not the dollar value amount, unfortunately once you convert all your dollars into Gold, your net worth in gold is frozen and does not grow, so holding physical gold is only good for 10%-20% for insurance, other 80% should be in investments to increase your gold net worth.
 
you can buy, when there are available coins or blobs
try to buy 4-5 items each time
when the price drop
this year 2019
 
SuprmeLeadr said:
I have ~15k AUD in bank and ~ 3k AUD and USD physical currency.


So my only option is gold and silver.

Do you guys think I should get move my bank into gold ASAP or spread it out over months/years to cost average my stack?
Click to expand...

Definitely -buy closer to spot on forum or 1/10 or 1/4oz au lunar mouse 2019-as many as you can afford.
 
jroly said:
In the 2008 GFC, ANZ bank ATMs stopped working for a couple of days and people couldn't get their money out, some people thought they were insolvent if I remember things correctly.



I don't believe in cost averaging nor buying everything at once but something between, you should try to buy when the prices are lower. I don't think holding gold is very good either because there is a lot of costs involved with buying and selling unless you do it through this site. I think Perth Mint unallocated gold is best, it's more liquid than physical gold, cost is 1% with a little spread and with the GoldPass you can transfer your Gold at no cost to other members so now you can make payments in gold. The Barring of Gold is expensive through the Perth Mint which is converting the unallocated to physical, but because you can use GoldPass there is no reason why someone would or would not want to swap you physical in exchange for GoldPass, I don't think this has ever happened before, I would like to see it.



You want to have Cash, I would keep 33%-50% in Cash so you can take advantage of opportunities when they arise, 25% in PMs and 25% in Gold mining companies. If you are up to it, you can earn between 2%-4.5% paid in gold by investing with a fund https://monetary-metals.com/

You want your savings working for you, but hoarding gold is the same as keeping money in a bank account, it's unimaginative and will hinder you and possibly wrong and bad thinking when you consider some philosophies, take for example The Parable of the Gold Coins which Jesus told when he was near Jerusalem, he told the story of a noble man whom left on a journey to become a king who gave a gold coin to each of his servants to entrust untill he returned. When he returned he summonsed his servants, the first one said he turned the gold coin into 10 gold coins, the man was pleased and gave him control of 10 cities. The second servant said he turned the gold coin into 5 gold coins, he was awarded 5 cities. The third servant still had the one gold coin, he said he went out and buried it so it couldn't be stolen. The man was very angry with him and said he can't be trusted with anything and took his gold coin and gave it to the man who had 10.

So you have to be active and try to grow your gold, the correct way to value your net worth is the gold value of your assets, not the dollar value amount, unfortunately once you convert all your dollars into Gold, your net worth in gold is frozen and does not grow, so holding physical gold is only good for 10%-20% for insurance, other 80% should be in investments to increase your gold net worth.
Click to expand...

And how do you determine the gold value of any asset(without putting any dollar value on it)?
 
wrcmad said:
Actually, dollar-cost-averaging as a strategy is a statistical dog. A load of bunk.
I have outlined why before on this forum, and it is yet to be refuted.
All-in or nothing, says the maths. :)
Click to expand...

I disagree. Your arguments are incorrect. For starters, returns on silver have historically run at less than 3% pa over the past 29 years, not 12.5% pa as you claim. This sinks your argument. Silver prices are very volatile, and given the relatively low long term returns, you risk making significant losses over the long term if you do not dollar cost average. Imagine if you had brought silver at $55 / ounce in 2011 in one hit........ The same applies to gold, although gold has returned around 5% pa over the same 29 year period.
 
rap53 said:
I disagree. Your arguments are incorrect. For starters, returns on silver have historically run at less than 3% pa over the past 29 years, not 12.5% pa as you claim. This sinks your argument. Silver prices are very volatile, and given the relatively low long term returns, you risk making significant losses over the long term if you do not dollar cost average. Imagine if you had brought silver at $55 / ounce in 2011 in one hit........ The same applies to gold, although gold has returned around 5% pa over the same 29 year period.
Click to expand...
I think that silver has had the disadvantage of previously being used as currency, and so many governments would have been selling their silver for the last few decades, and this would have suppressed prices.
 
rap53 said:
I disagree. Your arguments are incorrect. For starters, returns on silver have historically run at less than 3% pa over the past 29 years, not 12.5% pa as you claim. This sinks your argument. Silver prices are very volatile, and given the relatively low long term returns, you risk making significant losses over the long term if you do not dollar cost average. Imagine if you had brought silver at $55 / ounce in 2011 in one hit........ The same applies to gold, although gold has returned around 5% pa over the same 29 year period.
Click to expand...
Nice that I grabbed the attention of half of your first 4 posts! Sheesh.

Have a look when this was written - things have changed over the last few years as silver has shown itself to be a rubbish performer.
If you are basing your argument on a projected 3% pa return, then you are would be idiot to put ANY capital into a silver investment, DCA or no DCA.
I can return better than 3% per quarter with my eyes closed, and am disappointed if I return less than 3% per month - that's why I got out of silver all together.
 
I think Rich Dad Poor Dad explained it best. The best way to create wealth is by creating businesses. It is hard to create wealth as an employee. Everyone wants to be an investor but it takes several 100K to be a real investor. (My paraphrase).

Stacking is a hobby just like collecting anything else. If you are truly investing you need several 100K to make an impact.

Example; WC says he gets 2% a month investing. If he has 10K “invested” he will have just under 33K in 5 years if he is “reinvesting” or he takes home $200 a month. Nothing here to change his life. Same holds true if he has 100K. However, if he has 300K now he is at almost a million in 5 years reinvesting or he takes home 6K a month.

The problem is most people try to be an investor without the proper capital. That was my mistake about 5 years ago. I instead shifted gears 3 years ago into creating businesses. I have covered more wealth ground in 3 years than I had the previous 10 years working.
 
Last edited:
You must log in or register to reply here.
Back
Top