Suggestions for (usually) conservative investor?

L

Luna de Cuba

New Member
Since September 2010, I've accumulated 75oz of .999 silver. At today's spot, I've 'made' a 'profit' of about 85%. While I'm very pleased by that, I'm usually a very conservative investor and the volatility of silver makes me a tad nervous (if a little bit thrilled)l. I'm thinking I should convert a large part (or all) of my stack to a quite small holding of gold, buy more silver and convert that, etc. I'm in PMs for the long-term - 20yrs +. Does my thinking make sense?
 
Luna de Cuba said:
Since September 2010, I've accumulated 75oz of .999 silver. At today's spot, I've 'made' a 'profit' of about 85%. While I'm very pleased by that, I'm usually a very conservative investor and the volatility of silver makes me a tad nervous (if a little bit thrilled)l. I'm thinking I should convert a large part (or all) of my stack to a quite small holding of gold, buy more silver and convert that, etc. I'm in PMs for the long-term - 20yrs +. Does my thinking make sense?
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You can't lose money taking profit, why not do what you said and get a couple of ounces of gold, that way you've leveraged nicely.
 
It does make sense,

What Id suggest is for you to swap 30% - 60% of your silver into gold coins.

No need to go above 60%, no one knows where the GSR is headed, and could continue to climb down.
If it does continue to climb down, than you will lose some of your profits if you trade for gold now.
If it reverses and goes up than you will be getting double profits.

30 - 60 % into gold.

note: 30-60 % is based on you mentioning that you are conservative and a bit sceptical now.

dyod
 
Thanks for the replies! Another thing that concerns me is I seem to be emotionally attached to my silver which strikes me as a very bad thing for a very small-time investor. It feels like I need to get rid of it before this relationship goes too far and somebody gets hurt! :) Gold, on the other hand, appeals to me emotionally not one bit!
 
Doesn't hurt to occasionally do some horse trading of your favourite stuff - helps break the emotional attachment many people get - that's assuming you're investing, not collecting.
 
Hi Luna de Cuba, having done just what your thinking of doing lately with a ratio of my holdings and while not being overtly fond of gold either i must admit it grows on yah and it gives you another bloody graph to watch and its a darn site easier to stash too. There's some good advice on this site and some gold holdings cant hurt i think.. Good luck with whatever you decide.
 
The words "investment" and "emotional attachment" should never be used in the same sentence. It's very easy to get attached to silver but you need to think of it as simply a vehicle that you are using to acheive a desired out come.

The same goes for any investment.

I recently sold an investment property that I once vowed I should never sell. Very nice house in a highly sought after area of a town that has seen terrific growth, had an excellent long term tenant, locked in a 5.5% interest for the next 3 years, cashflow positive, low maintenance, the perfect investment property.

But I considered it overvalued, when the interest rate resets chances are it would've became cashflow negative and I seen no chance of further capital gains in the medium term.


It's hard to chop something that's working so well but these decisions need to be made with your head not your heart.


C
 
Contrarian said:
The words "investment" and "emotional attachment" should never be used in the same sentence...
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Exactly! Which is why one of us has to go! Think I'll treat silver like a love affair - best kept in the background and taken a little at a time.
 
I'll go against the grain of advice here.
Personal opinion if you only have 75 Oz silver-Hold fast young man,do not convert.
Your silver still has more room to grow I don't have endless hours to explain-but a good start for you is the google search engine.
Since 1st Sept 2010 the growth rate between silver and gold has been like over 100%Ag growth to around 5% growth rate for Au.
My advice is hold your silver and convert all your investment fiat into small denomination 24kt gold.
What your proposing to do is like changing footy teams tied at half time during a grand final.
Just doesn't make any sense and it seems kinda skittish.
Silver can be allowed to spiral up (JKTIGTBQ) without the equivalent impact on global currencies that a spiraling gold price would have.
Gold jumping to 2k would send shockwaves throughout the Fiat world and there would be savage counter measures being per sued to keep the price down.
Now money where your mouth is time-I bet 1 by 50cent 1966 round each with any takers that Silver out preforms gold by the 30th December 2011 in percentage
gain terms.
Good luck,but I agree with Gold pelican re the attachment conundrum.So if you have to sell one ounce of silver to kick the attachment disease go for it.

REDBACK
 
I originally thought it would be hard for me to sell my silver coins, but two recent situations have eased my concern. A large investment client had requested I buy 100 1oz Timberwolves for him and I waited until I was placing another order. Literally in between when I placed the quantity in the cart and added the quantity to the order Apmex raised the premium by .50. So I sold him 100 of my Timberwolves at the previous premium of $4.19 over spot. Of course, I expect the Timberwolves to eventually have a significant premium and that is why it was hard for me to part with the coins. I used the sales proceeds to buy some somalia elephant coins. The same client wanted to buy some animal coins for his child. He ended up ordering kooks and koalas. I have over 500 of the 2011 kooks and was willing to sell him the 50 he wanted, but there was nothing else I wanted to buy at the moment to replace the kooks. And right now, I am not willing to reduce my number of silver ounces.

My biggest concern is that I will value the coins too highly and hold out for a price that will not happen. That is why I hope that I am smart enough to depend upon ratio analysis and common sense in order to determine when to exit my pm positions.

Edit, I would keep the silver. The GSR should continue to decline and the silver is much more useful for barter, sales, etc.
 
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