WOOWWWW THERE, WHAT'S GOING ON?

[wrcmad]

wrcmad, While I do get your philosophy of losing opportunity when prices withdraw while holding physical purchased at X price, I still fail to see how an individual actually loses unless selling at a loss. You place the loss in ounces so far as I can tell but surely X amount of ounces is still x amount.

Would you consider x amount sold at Y price only to see Y rise the next day as a loss also, compared to holding for that extra day and X amount being worth Y more?

I am not being antagonistic here, merely trying to learn another point of view that conflicts with my own and hopefully learn something to add to the artillery.

From my own point of view if i buy X amount @ y price with the aim of holding to either hedge or save I fail to see, despite any sort of fluctuation in the price how I can lose on that purchase unless I sell. Sure enough if I timed my purchase in comparison to Y @ a lower rate I could of purchased possibly more but the same equation could also see me purchasing less of X for the same price.

Vice versa for selling x. I have say 10 ounces bought for $300 dollars, the price drops to $280 the next day. I have lost $20 dollars of opportunity according to my understanding of your opinion. But I still have 10 ounces.
If the price rose by $20 dollars the next day, I still have ten ounces. I have not sold or gained any more in ounces and the only change has been in fiat.

The fact is despite the change in value I still have the same amount in ounces. The only opportunity lost I can see is an ephemeral change in fiat value as opposed to a constant in weight.

I am trying to understand, A: If you hold how do you lose? B: If you buy and then sell and prices continue to rise is that not a loss? C: If you lose by holding till prices rise and also lose by selling if prices continue rise afterwards then why bother?

I should qualify by stating I am physical only and long term.

southerncross, I will try and answer to the best of my ability.

Paper loss - Definition - Loss which has occurred but has not yet been realized through a transaction, such as a stock which has fallen in value but is still being held. Also called unrealized loss.

The main thrust of this definition is that if you are holding an asset that has declined in value, then you have occurred a loss in value, or purchasing power. You have taken a hit in economic value. In the case of silver, you can propose that this is untrue because you still hold the same number of ounces, however those ounces are now worth less, and thus hold less value or purchasing power than they did when you acquired them. This, as measured using any means, defines a loss. It matters not if you want to measure in oz's or $ - you are now holding less value or purchasing power, ie a LOSS.

While that loss may recover over time, this only constitutes a loss followed by a recovery. This does not constitute a neutral position.

Plenty of people allow themselves to believe that they have not made a loss until they sell and crystallise that loss. If you are among them, then ask yourself this: Are your paper profits unreal too? If your answer is no, then you are suffering from a mental disease highly detrimental to your wealth - SELF-DELUSION.

It is simply not consistent to treat unrealised losses any differently from unrealised profits. The only reason investors do so is that they cannot bear to admit to themselves that they have in fact suffered a very real loss. Typically, they feel a loss equals a mistake, and they are unable to own up to their mistakes.

An example of this is stackers chasing spot price. Why is there such disappointment at buying, only then having spot price drop the next day? Because a real cost has been incurred due to timing.

In the world of investing, opportunity cost is present at all times. The opportunity cost of investing in bonds is investing in stocks that turn out better, or vice versa. The opportunity cost of investing today is investing on a different day when the price is lower. The opportunity cost of holding on to an investment is selling it before the price goes down. Lost opportunity, or opportunity cost, follows along the same lines. Opportunity cost is every bit real. It will cost real value, money, or purchasing power out of your pocket.

An example of this is stackers trading GSR. They are trading opportunity cost by trying to chase the better performing metal. It is real.

 

[lucky luke]

An example of this is stackers trading GSR. They are trading opportunity cost by trying to chase the better performing metal. It is real.

An excellent point! And being proficient in GSR trading appears to be an art in it's own right (which I do NOT have any ability in but wish I did). It's a wonder that all the long long long term physical stackers don't play that game more in order to grow their respective stacks without any use of fiat currency involved in the transactions.

 

[Guest]

wrcmad, While I do get your philosophy of losing opportunity when prices withdraw while holding physical purchased at X price, I still fail to see how an individual actually loses unless selling at a loss. You place the loss in ounces so far as I can tell but surely X amount of ounces is still x amount.

Would you consider x amount sold at Y price only to see Y rise the next day as a loss also, compared to holding for that extra day and X amount being worth Y more?

I am not being antagonistic here, merely trying to learn another point of view that conflicts with my own and hopefully learn something to add to the artillery.

From my own point of view if i buy X amount @ y price with the aim of holding to either hedge or save I fail to see, despite any sort of fluctuation in the price how I can lose on that purchase unless I sell. Sure enough if I timed my purchase in comparison to Y @ a lower rate I could of purchased possibly more but the same equation could also see me purchasing less of X for the same price.

Vice versa for selling x. I have say 10 ounces bought for $300 dollars, the price drops to $280 the next day. I have lost $20 dollars of opportunity according to my understanding of your opinion. But I still have 10 ounces.
If the price rose by $20 dollars the next day, I still have ten ounces. I have not sold or gained any more in ounces and the only change has been in fiat.

The fact is despite the change in value I still have the same amount in ounces. The only opportunity lost I can see is an ephemeral change in fiat value as opposed to a constant in weight.

I am trying to understand, A: If you hold how do you lose? B: If you buy and then sell and prices continue to rise is that not a loss? C: If you lose by holding till prices rise and also lose by selling if prices continue rise afterwards then why bother?

I should qualify by stating I am physical only and long term.

southerncross, I will try and answer to the best of my ability.

Paper loss - Definition - Loss which has occurred but has not yet been realized through a transaction, such as a stock which has fallen in value but is still being held. Also called unrealized loss.

The main thrust of this definition is that if you are holding an asset that has declined in value, then you have occurred a loss in value, or purchasing power. You have taken a hit in economic value. In the case of silver, you can propose that this is untrue because you still hold the same number of ounces, however those ounces are now worth less, and thus hold less value or purchasing power than they did when you acquired them. This, as measured using any means, defines a loss. It matters not if you want to measure in oz's or $ - you are now holding less value or purchasing power, ie a LOSS.

While that loss may recover over time, this only constitutes a loss followed by a recovery. This does not constitute a neutral position.

Plenty of people allow themselves to believe that they have not made a loss until they sell and crystallise that loss. If you are among them, then ask yourself this: Are your paper profits unreal too? If your answer is no, then you are suffering from a mental disease highly detrimental to your wealth - SELF-DELUSION.

It is simply not consistent to treat unrealised losses any differently from unrealised profits. The only reason investors do so is that they cannot bear to admit to themselves that they have in fact suffered a very real loss. Typically, they feel a loss equals a mistake, and they are unable to own up to their mistakes.

An example of this is stackers chasing spot price. Why is there such disappointment at buying, only then having spot price drop the next day? Because a real cost has been incurred due to timing.

In the world of investing, opportunity cost is present at all times. The opportunity cost of investing in bonds is investing in stocks that turn out better, or vice versa. The opportunity cost of investing today is investing on a different day when the price is lower. The opportunity cost of holding on to an investment is selling it before the price goes down. Lost opportunity, or opportunity cost, follows along the same lines. Opportunity cost is every bit real. It will cost real value, money, or purchasing power out of your pocket.

An example of this is stackers trading GSR. They are trading opportunity cost by trying to chase the better performing metal. It is real.

I retract my previous statement(s).

You make a very good point wrcmad and have convinced me my previous statement was short sighted.

I love to hear logic well laid out on the table and get an opportunity to learn something new, that's one of the best aspects of the SS community and why I wade through so much noise to get to the diamonds in the rough.

Bravo.

 

[longtime silver believer]

Now is a great time to buy, but it's been so since last year. Even when silver was at the $40s, it shouldn't be too distressing to have bought then, if you're looking to the long-term and not your monthly gains.

"Now is a great time to buy" oh noooooooooooooooooooo! here we go again

The "Glory Days" are comming back folks.........3 cheers for P.M'S ..hip,hip,hooorraay.

 

[Yippe-Ki-Ya]

how do they actually move the silver around :lol:
the whole team of SS will never move that kind of silver fast enough

It's easy.
Hold a core stack of physical.
Sell paper into the dips to hedge your stack - buy more physical ounces with profit.
Buy paper into the rises to add to your stack - buy more physical ounces with profit.

lol - i see you only make profits when you paper trade. you must be a really special dude :lol:

 

[Ernster]

lol - i see you only make profits with you paper trades. you must be a really gifted dude :lol:

:lol: I'm glad you're still here Yippe

 

[wrcmad]

lol - i see you only make profits when you paper trade. you must be a really special dude :lol:

Mmmmmm... is that what you see? (pffft)

You also saw this: http://forums.silverstackers.com/topic-28827-yippee-ki-yay-eats-humble-pie.html

Maybe you need to open your eye's a little wider.

 

[metalzzz]

I think the silver train has just departed despair station.

Next stop - Hope Town

 

[Spilver]

nothing about anything going moonish yet?
remember that ol' warcry?
are we more leaning to Isaac Newton now?
what goes up.....
good to see a little action finally though, more sideways than a beach full of crabs.

 

[longtime silver believer]

I think the silver train has just departed despair station.

Next stop - Hope Town

The silver train is building up steam...this time it is a big bastard and it is going to be hard to stop.All aboard!!!!

 

[Silverthorn]

The minutes from the Fed meeting are released tonight. Don't get too excited.

edit
correction

 

[warrenworthingtoniii]

The current jump in price just doesn't excite me. Maybe it's caution from being burned before, or that $49 is still a long way off. Hopefully you had bought earlier, but it's not too late to buy either.

 

[Rinchin]

wrcmad, While I do get your philosophy of losing opportunity when prices withdraw while holding physical purchased at X price, I still fail to see how an individual actually loses unless selling at a loss. You place the loss in ounces so far as I can tell but surely X amount of ounces is still x amount.

Would you consider x amount sold at Y price only to see Y rise the next day as a loss also, compared to holding for that extra day and X amount being worth Y more?

I am not being antagonistic here, merely trying to learn another point of view that conflicts with my own and hopefully learn something to add to the artillery.

From my own point of view if i buy X amount @ y price with the aim of holding to either hedge or save I fail to see, despite any sort of fluctuation in the price how I can lose on that purchase unless I sell. Sure enough if I timed my purchase in comparison to Y @ a lower rate I could of purchased possibly more but the same equation could also see me purchasing less of X for the same price.

Vice versa for selling x. I have say 10 ounces bought for $300 dollars, the price drops to $280 the next day. I have lost $20 dollars of opportunity according to my understanding of your opinion. But I still have 10 ounces.
If the price rose by $20 dollars the next day, I still have ten ounces. I have not sold or gained any more in ounces and the only change has been in fiat.

The fact is despite the change in value I still have the same amount in ounces. The only opportunity lost I can see is an ephemeral change in fiat value as opposed to a constant in weight.

I am trying to understand, A: If you hold how do you lose? B: If you buy and then sell and prices continue to rise is that not a loss? C: If you lose by holding till prices rise and also lose by selling if prices continue rise afterwards then why bother?

I should qualify by stating I am physical only and long term.

southerncross, I will try and answer to the best of my ability.

Paper loss - Definition - Loss which has occurred but has not yet been realized through a transaction, such as a stock which has fallen in value but is still being held. Also called unrealized loss.

The main thrust of this definition is that if you are holding an asset that has declined in value, then you have occurred a loss in value, or purchasing power. You have taken a hit in economic value. In the case of silver, you can propose that this is untrue because you still hold the same number of ounces, however those ounces are now worth less, and thus hold less value or purchasing power than they did when you acquired them. This, as measured using any means, defines a loss. It matters not if you want to measure in oz's or $ - you are now holding less value or purchasing power, ie a LOSS.

While that loss may recover over time, this only constitutes a loss followed by a recovery. This does not constitute a neutral position.

Plenty of people allow themselves to believe that they have not made a loss until they sell and crystallise that loss. If you are among them, then ask yourself this: Are your paper profits unreal too? If your answer is no, then you are suffering from a mental disease highly detrimental to your wealth - SELF-DELUSION.

It is simply not consistent to treat unrealised losses any differently from unrealised profits. The only reason investors do so is that they cannot bear to admit to themselves that they have in fact suffered a very real loss. Typically, they feel a loss equals a mistake, and they are unable to own up to their mistakes.

An example of this is stackers chasing spot price. Why is there such disappointment at buying, only then having spot price drop the next day? Because a real cost has been incurred due to timing.

In the world of investing, opportunity cost is present at all times. The opportunity cost of investing in bonds is investing in stocks that turn out better, or vice versa. The opportunity cost of investing today is investing on a different day when the price is lower. The opportunity cost of holding on to an investment is selling it before the price goes down. Lost opportunity, or opportunity cost, follows along the same lines. Opportunity cost is every bit real. It will cost real value, money, or purchasing power out of your pocket.

An example of this is stackers trading GSR. They are trading opportunity cost by trying to chase the better performing metal. It is real.

I retract my previous statement(s).

You make a very good point wrcmad and have convinced me my previous statement was short sighted.

I love to hear logic well laid out on the table and get an opportunity to learn something new, that's one of the best aspects of the SS community and why I wade through so much noise to get to the diamonds in the rough.

Bravo.

Although you might be technically totally correct and this had educated my much my unevolved mind still calculates things differently.......

Currency spend on silver = currency saved as money
Currency not spent on silver = currency spent on junk food, booze and other rubbish

In reality if i spend $48 on an oz and spot drops to $9 that's $9 worth of something I wouldn't have had otherwise. = Profit
If I spend $48 on a bottle of rum can I get away with the $9 hangover?.... either way = loss

 

[Ernster]

Currency spend on silver = currency saved as money
Currency not spent on silver = currency spent on junk food, booze and other rubbish

In reality if i spend $48 on an oz and spot drops to $9 that's $9 worth of something I wouldn't have had otherwise. = Profit
If I spend $48 on a bottle of rum can I get away with the $9 hangover?.... either way = loss

That's looking at things a little too simple. It entirely depends if you actually cut back on those unnecessary spending like alchohol. If you keep wasting your money at the same rate, and you buy silver with the money you where going to put in the bank, you could be in a worse position during a crash/correction.