The risk of having too much Gold in your portfolio?

Slimey said:
Dividends are irrelevant. Look at Newscorp, it was made clear to them many years ago that you can have dividend or capital growth, take your pick....they went for growth. When you have capital growth, either real or imagined, greed will drive the price through the roof. A bit like split window V.W.'s. The price went through the roof because everyone wanted a piece of the pie. It didn't matter that it was still the same underpowered, unreliable, basic bit of junk that it was. It was the greed factor that drove it northwards in price.
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SilverDJ asked about "dividend returning stocks and ETF's?", not about capital growth returning stocks.
 
Yes sorry, I was just adding to your point about dividends falling. If interest rates go negative, the chase will be on for anything that has any kind of return. In turn the increase in share price at the expense of dividend return will attract those looking for short term capital gain. Like a positive feedback loop.
 
Slimey said:
$10,000 in the share market in 1979 vs $10,000 gold in 1979. Wayyyyyyyyyyyyyyy behind ( You are correct leo....not wayyyy behind...I should have added a lot more yyyyy's )
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meh, All Ords was about $500 in 1979 (13x up) Gold was about $240 in 1979 (9x up). Give it 6 months and All Ords will be down and gold further up, then they might both be around 10x up from 1979. On average over time they perform about the same, so someone should pick whatever they feel more comfortable with. Pick half and half and you can't go wrong.
 
leo25 said:
meh, All Ords was about $500 in 1979 (13x up) Gold was about $240 in 1979 (9x up). Give it 6 months and All Ords will be down and gold further up, then they might both be around 10x up from 1979. On average over time they perform about the same, so someone should pick whatever they feel more comfortable with. Pick half and half and you can't go wrong.
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But if you invested in a parcel of dividend paying shares that followed the index you'd be MUCH further ahead due to compounding, especially if you reinvested dividends into more shares.
 
willrocks said:
Cheap money may push stock prices up, but it won't drive bigger dividends. Dividends will shrink under zero or negative interest rates.
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So a well run company that's making a profit will suddenly magically stop paying dividends because interest rates are negative? Why?
 
SilverDJ said:
But if you invested in a parcel of dividend paying shares that followed the index you'd be MUCH further ahead due to compounding, especially if you reinvested dividends into more shares.
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But but but.....If you invested in S1 lunar coins you would be better off still. We can go round and round.
 
SilverDJ said:
So a well run company that's making a profit will suddenly magically stop paying dividends because interest rates are negative? Why?
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I don't think I said "suddenly magically stop paying".

Phase 1
This is just my opinion. I think those few well run companies that currently pay decent dividends will become overvalued. More money seeking inflation beating returns will move into those dividend producing stocks. Higher share prices and the same dividends will mean p/e ratios will suffer.

Phase 2
Economic slowdown will hurt a lot of sectors. Many sectors that return dividends right now probably won't during a recession.
 
So - should the "average person" focus on gold for long-term savings?

I think 50 % PM's, 50 % currency is a simple, basically adequate strategy for the "normal" person who know nothing about
sophisticated investment vehicles (like shares, bonds etc.).

What do you think?
 
You may end up with 50% paper weights and 50% bits of paper (plastic) that inflation mice have eaten a part of. Just like you would have if you had used this strategy in 1976-1980. By the mid 80's it would have been very apparent that this would be the worst choice. I believe the best you can do is not to fixate on an unbending formula based on guess work. Take the time to investigate, invest in what you know and understand and not to be greedy. Easy in theory of course. Those of us that have been watching this gold bull slowly develop over the last 18 years can see that end game is developing. This could take 6-10 more years to play out but it will have an end. It is a good time to take positions now keeping in mind that there will be a lot of pullbacks before it is all over.
 
The only risks people take is in making bad choices, not in the metals themselves.

Buy when it's cheap and theres no risk. Buy when everyone hates it and its undervalued and theres no risk. Avoid numismatic nerd stuff and big premiums and theres no risk.

Of course if someone buys on a spike they take a chance to lose but that doesnt have to be us. We will be selling at that time.
 
Gold is a time proven insurance and looking at it as a stone cold investment is wrong in my opinion :)

Other than cash what else can you put your hands on at a minutes notice that will get you out of a jam :confused:

You wouldn't want over 80oz's of silver in your pocket when just 1oz of gold will do :D

Gold is the worlds greatest insurance other than knowledge :)

So can you have too much gold = No :D

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The Book of Psalms Chapter 144 verse 4

Man is like a breath,his days are like a passing shadow :)
 
Gold is not an investment. It is a hedge against inflation and a store of wealth. Silver is not an investment. It is an industrial metal useful as a currency that many people gamble will rise significantly.

Investments in physical precious metals make no sense. Savings in PMs do. Investments need to earn you money, not store or lose money.
 
leo25 said:
Gold was on average about $180~ oz AUD between 1976-79, now it's over $2200. Can you explain how that puts you wayyyy behind?
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Probably in comparison to property? How much is a typical house in sydney in 1976? Assuming $40k. How much would it be worth today? $1 million? So, it's 25x gain. Based on current trend, do you see an Australian house be worth $25 million in 45 years?

If anyone knows about economics, this is not possible because real wages are not going to increase much further, and mortgage rates can't drop below zero. Or maybe it can?

https://www.smartcompany.com.au/ind...he-median-australian-house-price-was-in-1976/

But if mortgage rates can drop below zero, it might be more profitable to invest in bitcoin?

More likely, what will happen is in 45 years, most jobs will be replaced by robots and the majority of people are jobless, living a basic wage that won't even buy you a house. Governments will build camps to house these people.

This is for wealthy democratic country like australia. For non-democratic or poor country, there will be no basic wage and majority of people will be living in squatters.
 
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sgbuyer said:
More likely, what will happen is in 45 years, most jobs will be replaced by robots and the majority of people are jobless, living a basic wage that won't even buy you a house. Governments will build camps to house these people.
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20 years ago people said there won't be enough jobs because of the advancements in agriculture, robotics in factories and computers. Lucky people are "innovative" and the financial sector and government expanded massively with new jobs. I mean who else is going to move paper around, have 2 hour lunch breaks and scam other people? I doubt a stupid robot can handle those jobs. :rolleyes: oh and lets not forget all the YouTube and Instagram influencers!

Yep the future looks very bright indeed...
 
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