Physical v ETF %

Discussion of the Gold portion of the Permanent Portfolio

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mase
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Physical v ETF %

Post by mase » Mon Apr 02, 2018 4:11 pm

Quick question - to help with rebalancing what % of gold would you hold in physical v ETF ?

At the moment I have no ETF but it would be a nightmare selling physical when that day comes.
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ochotona
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Re: Physical v ETF %

Post by ochotona » Mon Apr 02, 2018 7:01 pm

What rebalancing bands do you want to use? Where are you now in those bands?
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Hal
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Re: Physical v ETF %

Post by Hal » Tue Apr 03, 2018 5:18 am

mase wrote:Quick question - to help with rebalancing what % of gold would you hold in physical v ETF ?

At the moment I have no ETF but it would be a nightmare selling physical when that day comes.
I would hold 15% as physical gold and the remainder of the gold allocation as an ETF. So, 15% Physical and 0 to 20% ETF.
If you want to hold all physical, try the Perth Mint. A transaction with them takes less than two minutes on the phone !
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sophie
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Re: Physical v ETF %

Post by sophie » Tue Apr 03, 2018 7:43 am

I only own ETFs because I can't keep all my gold in taxable space. If I could, I wouldn't use them at all. It's not unreasonable to keep some gold in a tax-advantaged account so you could rebalance without incurring a big tax bill, but I'm not sure that benefit is worth giving up the advantages of gold held directly.

An unallocated stash with the Perth Mint's depository online is safer than an ETF (IMHO) and makes it easy to rebalance if needed - no phone calls necessary. Fees are minimal and storage is free. Some forum members use GlobalGold or GoldMoney which have similar services (although one of them closed up shop recently and I can't remember which).
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Re: Physical v ETF %

Post by Cortopassi » Tue Apr 03, 2018 10:42 am

About 15% of my current gold allocation is in GLD to do exactly what you want for rebalancing. Makes it easier, for sure. 15% is not a target, just what it happens to be.

If I need to buy more gold to rebalance, I will continue buying GLD vs. physical -- I am OK with the amount of physical I have and don't need/want to add.
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Re: Physical v ETF %

Post by Libertarian666 » Thu Apr 05, 2018 9:15 pm

sophie wrote:I only own ETFs because I can't keep all my gold in taxable space. If I could, I wouldn't use them at all. It's not unreasonable to keep some gold in a tax-advantaged account so you could rebalance without incurring a big tax bill, but I'm not sure that benefit is worth giving up the advantages of gold held directly.

An unallocated stash with the Perth Mint's depository online is safer than an ETF (IMHO) and makes it easy to rebalance if needed - no phone calls necessary. Fees are minimal and storage is free. Some forum members use GlobalGold or GoldMoney which have similar services (although one of them closed up shop recently and I can't remember which).
Global Gold is still in business: https://www.globalgold.ch/.
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Re: Physical v ETF %

Post by boglerdude » Sat Apr 21, 2018 11:44 pm

What info does Perth give the Feds?
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sophie
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Re: Physical v ETF %

Post by sophie » Sun Apr 22, 2018 8:31 am

They don't report anything. The Mint's financial accounts are set up to avoid being classed as a bank, e.g. you can't link more than one bank account and it's difficult to change it. From the Perth Mint FAQ:
What are the Mint's policies on privacy and reporting?

Under Section 74 of the Gold Corporation Act 1987 employees of The Perth Mint face fines and imprisonment if they directly or indirectly divulge to any person any information concerning the business affairs of customers of The Perth Mint (excluding to a court or under Australian law).

Requests for information on customer accounts from Australian organisations without any statutory right to request such information, or from any foreign organisation or agency, will be denied and will instead be directed to apply to an Australian court for a court order directing us to release the information.

Customers should be aware that we will comply with any lawful request for information from Australian authorities or Governmental agencies including to the Australian Transaction Reports and Analysis Centre under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 and associated policies and regulations.

We are not aware of any other custodial facility where breach of privacy results in imprisonment or fines.
The FBAR requirement is for reporting by the individual, i.e. you. Unless you travel to Australia and invest with handfuls of cash, you'll leave enough of a trail that your account would be discoverable given enough digging. I would guess it's unlikely that the IRS would learn of your Perth Mint account if you don't file FBAR, but you are risking a lot if the worst happens:

https://www.forbes.com/sites/robertwood ... c4d0b420cd
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Re: Physical v ETF %

Post by boglerdude » Mon Apr 23, 2018 6:09 am

Thanks sophie. If I want a coin, I convert to allocated and pay 5% fabrication fee, then FedEx shipping fee

Or, sell my unallocated back to Perth for spot +1% fee, get USD ACH'd to my bank, then buy a coin at a local or online dealer

Or, order a prefab coin from Perth, but not from my storage. Today they're selling 1oz coins for $1403. Spot is 1334, so $70 markup, 5.25%
Edit: US cant register https://www.perthmintbullion.com/us/Reg ... Trade.aspx

I cant just pick up a coin from a Perth USA distributor, using gold or USD I have at Perth

If any of that's wrong lmk =)
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sophie
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Re: Physical v ETF %

Post by sophie » Mon Apr 23, 2018 5:27 pm

Your two gold storage options at Perth Mint are unallocated (the free version with the buy/sell fees) and allocated storage. With allocated storage, you pay a fabrication fee for the coin or bar you choose, then the Mint will charge storage fees. Once you have that set up, you can then take delivery:

https://www.perthmint.com/storage/help/ ... ivery.html

If your goal is to buy physical gold to hold yourself, I wouldn't bother going through the Perth Mint as the fees would really add up - just buy from one of the many dealers in your home country. My intent with that account is to leave the money in unallocated storage, where it serves as international diversification. I don't plan to sell except to rebalance, but would do so only after the ETFs in my retirement accounts are sold off.
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Xan
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Re: Physical v ETF %

Post by Xan » Mon Apr 23, 2018 5:55 pm

sophie wrote:Your two gold storage options at Perth Mint are unallocated (the free version with the buy/sell fees) and allocated storage. With allocated storage, you pay a fabrication fee for the coin or bar you choose, then the Mint will charge storage fees. Once you have that set up, you can then take delivery:

https://www.perthmint.com/storage/help/ ... ivery.html

If your goal is to buy physical gold to hold yourself, I wouldn't bother going through the Perth Mint as the fees would really add up - just buy from one of the many dealers in your home country. My intent with that account is to leave the money in unallocated storage, where it serves as international diversification. I don't plan to sell except to rebalance, but would do so only after the ETFs in my retirement accounts are sold off.
Can you show up in person and claim your gold? Is that easier when it's allocated or unallocated?
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Re: Physical v ETF %

Post by boglerdude » Mon Apr 23, 2018 8:43 pm

You can go pickup your allocated. Long drive tho
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