The ideal percentage of Gold in a portfolio
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The ideal percentage of Gold in a portfolio
Someone forwarded this article to me, and I thought I'd pass it along. The conclusion should not be too surprising to anyone here.
http://proactiveadvisormagazine.com/gol ... portfolio/
http://proactiveadvisormagazine.com/gol ... portfolio/
- dualstow
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Re: The ideal percentage of Gold in a portfolio
Nice. I'm reading Part I.
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Re: The ideal percentage of Gold in a portfolio
Very interesting. HB was pretty smart!
Re: The ideal percentage of Gold in a portfolio
Actually, is surprising when it's not on this forum and not 0%.Tyler wrote:Someone forwarded this article to me, and I thought I'd pass it along. The conclusion should not be too surprising to anyone here.
http://proactiveadvisormagazine.com/gol ... portfolio/
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Re: The ideal percentage of Gold in a portfolio
If the start date of their analysis was a few years (i.e.76-80) later my guess is it would suggest a lower allocation.
(Would be interesting to hear Desert comment on that)
(Would be interesting to hear Desert comment on that)
Re: The ideal percentage of Gold in a portfolio
The Ned Davis Three-Way Portfolio is a trendfollowing cashless HBPP, and it can go 100% into gold! (temporarily)
http://mebfaber.com/2015/06/16/three-way-model/
http://mebfaber.com/2015/06/16/three-way-model/
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Re: The ideal percentage of Gold in a portfolio
What does it cost mine gold? Does that limit how high it can go?
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Re: The ideal percentage of Gold in a portfolio
ochotona wrote:The Ned Davis Three-Way Portfolio is a trendfollowing cashless HBPP, and it can go 100% into gold! (temporarily)
http://mebfaber.com/2015/06/16/three-way-model/
My read of this was 1/3 each of stocks, bonds and gold, but with the asset being replaced by t-bills when it didn't have momentum. Meb Faber likes his momentum. I think it suffers from recency bias particularly for USA. The past does not indicate the future. The clear ups-downs of SP500 model well with momentum but that advantage appears to disappear with eg non-US markets. I also think there is an inherent risk by not eg. being in bonds if stocks suddenly tank. And then the tax implications from the churn of frequency short trades when markets going side ways....
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Re: The ideal percentage of Gold in a portfolio
The supply of "new" gold from mining every year is only a percent or two of the overall supply because most gold isn't consumed but stored. This is quite unlike all non-monetary commodities, where the new supply comprises most of the available stock at any time.boglerdude wrote:What does it cost mine gold? Does that limit how high it can go?
It is also very difficult and expensive to increase gold mining output, and there is only so much gold to be mined.
For both of these reasons, mining supply has little to do with the gold price.
Re: The ideal percentage of Gold in a portfolio
My latest thinking... thinking about the amount of gold to have as # of ounces per million dollars in a portfolio.
I'm after Desert Portfolio levels, 10%, so I'm thinking... 80 ounces per $1 million. Keep that constant over time.
Then how much gold costs becomes less important. It fades a bit.
I'm after Desert Portfolio levels, 10%, so I'm thinking... 80 ounces per $1 million. Keep that constant over time.
Then how much gold costs becomes less important. It fades a bit.
- dualstow
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Re: The ideal percentage of Gold in a portfolio
But that's not a constant, right?
Shouldn't the US$ price or one's home currency price matter more?
Separately, my dream of having my weight in gold is not going to happen. Too rich for my blood.
Shouldn't the US$ price or one's home currency price matter more?
Separately, my dream of having my weight in gold is not going to happen. Too rich for my blood.
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Re: The ideal percentage of Gold in a portfolio
Then perhaps you should go on a diet.dualstow wrote: But that's not a constant, right?
Shouldn't the US$ price or one's home currency price matter more?
Separately, my dream of having my weight in gold is not going to happen. Too rich for my blood.
- dualstow
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Re: The ideal percentage of Gold in a portfolio
Ha! Well, the way I see it, it's more fun to buy some spanikopitas from Trader Joe's anyway. AND cheaper.