What metal stack ratios would you recommend to a new stacker?

[Monsta]

I have two contacts that are looking into accumulating silver as a store of wealth. While I don't consider them as 'preppers' they are indeed wary of the economy and the world at large. Both are asking me certain questions and looking for advice regarding their intentions - mainly where they go to buy it, and how to buy it.

It got me to thinking - what metals should I recommend that they start stacking, and in what ratio?

I started as a bullion buyer rather than a stacker, so 10oz silver bars and full ounce blobs of gold. My personal goal was to try and accumulate just silver at the start, and then get an ounce of gold every so often. It worked for me however with the current markets and the global economy the way it is...... I think that puts a new stacker underweight in gold.

If I was starting out on a stacking journey today, I would probably be looking at purchasing equal dollar value of gold and silver rather than a 'weight ratio'. So, if I was getting $100 worth of silver (let say 4x 1oz Kangaroos goes for about AUD$105 retail) then I would be trying to get the same in gold which would be a 1/10oz coin which can be sourced around the AUD$105 mark also.

What did you do, and what would you do if you could start stacking today?

Concentrate on silver? Try to buy more fractional gold?

Accumulate on weight ratio like 30:1 in favour of silver, or buy according to dollar value?

Buy small amounts regularly or save the pennies and get a larger order?

 

[Miloman]

GSR based.

Rough guide spend money by :
60:1 or higher accumulate 90% Silver 10% Gold
40:1 or lower accumulate 70% Gold 30% Silver
20:1 or lower accumulate 90% Gold 10% Silver

What's interesting is that this can be used to do GSR swaps to shift stack. But it depends also on storage capacity/costs and how much money you have.

 

[long88]

Establish your cash flow via property, business and use the cash flow accumulated to buy pm.

You dont want to be selling out of your stack because one day you need those $$$ fiat.

Remember this is insurance that you dont want to use, but it need to stay there forever, we dont know how long current system can lasts. If your net wealth grows, accumulate 10-20% to stacking

 

[Holdfast]

Monsta

As a suggestion...it's perhaps not a good idea to suggest anything to your friends if you have to ask the forum what to do.

If your friends are "you"!!!

Ask yourself why do you want to buy precious metal and before you buy ask ypurself how will you sell...who to...when...and the tax implications.

 

[Holdfast]

Establish your cash flow via property, business and use the cash flow accumulated to buy pm.

You dont want to be selling out of your stack because one day you need those $$$ fiat.

Remember this is insurance that you dont want to use, but it need to stay there forever, we dont know how long current system can lasts. If your net wealth grows, accumulate 10-20% to stacking

Bravo..Bravo..Bravo.

Couldn't agree more!

 

[SilverDJ]

Concentrate on silver? Try to buy more fractional gold?

Silver has been a dog, and I think will continue to be so. Don't believe the GSR, it's just a ratio, so it can drop again but that doesn't mean silver will go up.
Gold is the real deal and long term will be the safest bet. So more gold than silver I think.

 

[mmm....shiney!]

My own thoughts based upon risk and age.

 

[SilverDJ]

My own thoughts based upon risk and age.

What's the reasoning behind that?

 

[Monsta]

As a suggestion...it's perhaps not a good idea to suggest anything to your friends if you have to ask the forum what to do. If your friends are "you"!!!

My friends are not at all like me, and I believe that I started my journey quite differently to most of the members here. I originally bought PM's years ago to diversify/hedge an investment portfolio of shares and have more recently gone to a 'wealth protection' mode. These two friends are looking to store wealth outside the fiat system.

What I was looking for was some experiences that were different to my own, and as such the suggestions from other members that did start out small. Even to the point of how their first few purchases went, what got them started.

Ask yourself why do you want to buy precious metal and before you buy ask yourself how will you sell...who to...when...and the tax implications.

I have already asked them to think along these lines. I think for both of them the tax implications will be of the least concern - it's more of a 'recognised currency' during a time of crisis. I cannot say I blame them with the people in charge of the various economic powers seemingly setting us up for massive pain soon.

 

[mmm....shiney!]

My own thoughts based upon risk and age.

What's the reasoning behind that?

Firstly I want to point out the sage advice from both long88 and you as posted above. To understand my thoughts, it's necessary to appreciate that advice and then to understand that income earners are capable of absorbing risk in differing amounts throughout our working life.

If I can work backwards, naturally older people have little opportunity to replace any losses with more income, simply because age is not on their side. Middle age workers are generally approaching their peak opportunity for financial return and if all things go to plan, a 45 yo say has 20 - 25 years of reward ahead of him. Younger workers have both a tax system actively working against their best interests and a brief history of lower paid employment compared to their future potential. Any capital reserves that they do manage to accumulate and any assets that they have bought as a result of trading off consumer goods are naturally limited, and because they don't amount to much are easily and regularly threatened by both seen and unseen financial events ie fines, living expenses, vehicle accidents etc. In other words, the capacity for older and younger people to absorb risk upon their accumulated assets is less than a middle aged income earner.

Following that logic then, and acknowledging the risk that silver possesses, it makes sense then that both young workers and older people adopt a more risk averse position when it comes to accumulating precious metals.

 

[miniroo]

how can you get 1/10 oz gold coins for AU$105?
3.1 grams of gold at spot is $150 alone

sounds to me you have never bought gold and don't have 2 contacts

 

[Holdfast]

As a suggestion...it's perhaps not a good idea to suggest anything to your friends if you have to ask the forum what to do. If your friends are "you"!!!

My friends are not at all like me, and I believe that I started my journey quite differently to most of the members here. I originally bought PM's years ago to diversify/hedge an investment portfolio of shares and have more recently gone to a 'wealth protection' mode. These two friends are looking to store wealth outside the fiat system.

What I was looking for was some experiences that were different to my own, and as such the suggestions from other members that did start out small. Even to the point of how their first few purchases went, what got them started.

Ask yourself why do you want to buy precious metal and before you buy ask yourself how will you sell...who to...when...and the tax implications.

I have already asked them to think along these lines. I think for both of them the tax implications will be of the least concern - it's more of a 'recognised currency' during a time of crisis. I cannot say I blame them with the people in charge of the various economic powers seemingly setting us up for massive pain soon.

"Still"...it's very dangerous to advise folk.

If they don't have the investment ethos that you have they may be disappointed.

If they make a tonne of money you are a heroe...if they are down 10- 20- 50 percent you won't have friends anymore.

We have had many folk on the forum who have advised when silver was 40 to buy more and we have had folk who even now say keep the faith.

They have been wrong and it would be in your own interest to do your own thing. :|

 

[Monsta]

how can you get 1/10 oz gold coins for AU$105?
3.1 grams of gold at spot is $150 alone

Sorry, 1/20th... I've been up since 5am.

And if you are happy to push that sort of personal attack, I am quite happy to put you on my ignore list both here and elsewhere.

"Still"...it's very dangerous to advise folk. If they don't have the investment ethos that you have they may be disappointed.

If they make a tonne of money you are a heroe...if they are down 10- 20- 50 percent you won't have friends anymore.

Absolutely. But in this case it is not a "you should buy this" response but a "think about gold and silver, both bullion and coins" conversation. Both approached me based on other conversations regarding general state of the economy, local interest rates, the housing market, EU NIRP, US QE etc.

We have had many folk on the forum who have advised when silver was 40 to buy more and we have had folk who even now say keep the faith.

They have been wrong and it would be in your own interest to do your own thing. :|

I believe owning/holding PM's is a good thing, if only as a diversification away from keeping all your money in the bank. The price will always vary, it's all part of why most of us are taking a keener interest in this sort of thing.

 

[miniroo]

lol

 

[long88]

Monsta, you can always keep cash under your pillow.

Or stash it between the books.

how can you get 1/10 oz gold coins for AU$105?
3.1 grams of gold at spot is $150 alone

Sorry, 1/20th... I've been up since 5am.

And if you are happy to push that sort of personal attack, I am quite happy to put you on my ignore list both here and elsewhere.

"Still"...it's very dangerous to advise folk. If they don't have the investment ethos that you have they may be disappointed.

If they make a tonne of money you are a heroe...if they are down 10- 20- 50 percent you won't have friends anymore.

Absolutely. But in this case it is not a "you should buy this" response but a "think about gold and silver, both bullion and coins" conversation. Both approached me based on other conversations regarding general state of the economy, local interest rates, the housing market, EU NIRP, US QE etc.

We have had many folk on the forum who have advised when silver was 40 to buy more and we have had folk who even now say keep the faith.

They have been wrong and it would be in your own interest to do your own thing. :|

I believe owning/holding PM's is a good thing, if only as a diversification away from keeping all your money in the bank. The price will always vary, it's all part of why most of us are taking a keener interest in this sort of thing.

 

[clear]

My own thoughts based upon risk and age.

What's the reasoning behind that?

Firstly I want to point out the sage advice from both long88 and you as posted above. To understand my thoughts, it's necessary to appreciate that advice and then to understand that income earners are capable of absorbing risk in differing amounts throughout our working life.

If I can work backwards, naturally older people have little opportunity to replace any losses with more income, simply because age is not on their side. Middle age workers are generally approaching their peak opportunity for financial return and if all things go to plan, a 45 yo say has 20 - 25 years of reward ahead of him. Younger workers have both a tax system actively working against their best interests and a brief history of lower paid employment compared to their future potential. Any capital reserves that they do manage to accumulate and any assets that they have bought as a result of trading off consumer goods are naturally limited, and because they don't amount to much are easily and regularly threatened by both seen and unseen financial events ie fines, living expenses, vehicle accidents etc. In other words, the capacity for older and younger people to absorb risk upon their accumulated assets is less than a middle aged income earner.

Following that logic then, and acknowledging the risk that silver possesses, it makes sense then that both young workers and older people adopt a more risk averse position when it comes to accumulating precious metals.

why no (maybe consider 90% Silver) silver in first 25 years, doesn't make sense, plenty of time to recover, risk averse - why

 

[mmm....shiney!]

why no (maybe consider 90% Silver) silver in first 25 years, doesn't make sense, plenty of time to recover, risk averse - why

Maybe it's a contrarian view to risk?

As I said:

Any capital reserves that they do manage to accumulate and any assets that they have bought as a result of trading off consumer goods are naturally limited, and because they don't amount to much are easily and regularly threatened by both seen and unseen financial events

Job losses, downturns in economic conditions, accidents etc all threaten a young person's capacity to protect and grow their capital. Like a business, in the early stages of an employee's career, it's about managing capital by restricting losses and expenses as much as possible.

 

[clear]

why no (maybe consider 90% Silver) silver in first 25 years, doesn't make sense, plenty of time to recover, risk averse - why

Maybe it's a contrarian view to risk?

As I said:

Any capital reserves that they do manage to accumulate and any assets that they have bought as a result of trading off consumer goods are naturally limited, and because they don't amount to much are easily and regularly threatened by both seen and unseen financial events

Job losses, downturns in economic conditions, accidents etc all threaten a young person's capacity to protect and grow their capital. Like a business, in the early stages of an employee's career, it's about managing capital by restricting losses and expenses as much as possible.

I understand what you are saying - but losses in the first 25 years are small and everyone should recover, but do you agree time is the equalizer or enemy - most would be wealthy if we had unlimited time. Time is the key element

more time = more wealth generally

 

[mmm....shiney!]

I understand what you are saying - but losses in the first 25 years are small

Small compared to what?

and everyone should recover,

That's the conventional view.

 

[clear]

small compared to future earning.

ps are you under 40