Talk me into selling my gold miners.

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Matthew19
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Talk me into selling my gold miners.

Post by Matthew19 » Sat Jul 18, 2015 10:22 am

I'm having a real mental problem realizing my 70k loss in gold miners to raise funds for the PP. I can't friggin believe it.
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Stewardship
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Re: Talk me into selling my gold miners.

Post by Stewardship » Sat Jul 18, 2015 11:46 am

I owned HMY for years until I realized that it wasn't doing what I bought it to do:  to do well if gold did well.  HB wrote that gold mine stocks could move in the opposite direction of gold.  He was right, big time.

Just take it as a $70k education expense, be thankful it wasn't more, and move on all the wiser.
Last edited by Stewardship on Sat Jul 18, 2015 11:48 am, edited 1 time in total.
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Re: Talk me into selling my gold miners.

Post by barrett » Sat Jul 18, 2015 2:09 pm

Matthew19 wrote: I'm having a real mental problem realizing my 70k loss in gold miners to raise funds for the PP. I can't friggin believe it.
Have you looked at the tax advantages of carrying that loss forward years into the future? It sucks to have a big loss like that but it may just be the gift that keeps on giving (assuming you have enough income or gains that a loss helps to offset some profits). There are folks on here who know a lot about this. Unfortunately I am not one of them.

I remember reading an article by Peter Lynch of Fidelity Magellan fame years ago. He claimed that the only sensible way to play the gold game was to invest in the miners because a small move up in the price of gold could mean a big move up in the share price of mining stocks. Of course that doesn't work in a down market.

Look into the tax-loss harvesting. Having a big loser on your statement is a downer. Good luck.
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Re: Talk me into selling my gold miners.

Post by clacy » Sat Jul 18, 2015 3:27 pm

I would keep it. Just about the time you feel like puking, average into some more shares. Eventually miners will come back.

I own none myself so it's easy for me to give advice with someone else's money, but I'm strongly considering averaging into some GDX leaps
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Re: Talk me into selling my gold miners.

Post by Reub » Sat Jul 18, 2015 4:10 pm

To me owning gold in your PP is plenty of exposure to the sector.  Find something else to invest your VP in.
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Matthew19
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Re: Talk me into selling my gold miners.

Post by Matthew19 » Sat Jul 18, 2015 9:48 pm

clacy wrote: I would keep it. Just about the time you feel like puking, average into some more shares. Eventually miners will come back.

I own none myself so it's easy for me to give advice with someone else's money, but I'm strongly considering averaging into some GDX leaps
Iv felt like puking for about a month. Yes they are low but they could go much lower for a lot longer.
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Re: Talk me into selling my gold miners.

Post by Libertarian666 » Sat Jul 18, 2015 10:00 pm

Matthew19 wrote: I'm having a real mental problem realizing my 70k loss in gold miners to raise funds for the PP. I can't friggin believe it.
Gold mining stocks are stocks, not gold.
Sell and don't look back.
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Cortopassi
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Re: Talk me into selling my gold miners.

Post by Cortopassi » Sat Jul 18, 2015 11:00 pm

I owned GDX and GDXJ for a long period, watched them go way above my cost (only sold some) and then way below.  And that was 2 years ago.

I think you are reasonably closer to an end of the bear than I certainly was, but as you say, could still go much lower.

What I did at the time to make myself feel like I wasn't completely giving up on them is I took about 10% of the sales proceeds and bought LEAPs about 2 years out (they expire in 2016).  And those for me have about 99.9% chance of expiring completely worthless.  I did the same with SLV.  Sold the stock, at about breakeven, and replaced with options which also will be guaranteed to expire worthless.  So swapping to options still leaves you with some skin in the game.

I do believe you are in a tough situation.  It is very possible gold will drop even more, since things always are taken too far in both directions, and you'll probably see more paper losses.  But you know that right when you sell things will turn, right?  Well, they didn't for me so that isn't always what happens! 

Barrett talks of the loss carryovers.  I have enough loss carryover to last the rest of my friggin life.  It is a reasonable way to go as well.

I am glad I saw your post.  Because it brought me back to those days of trading too much, trading miners, trading tips and the puking feeling.

I have not once had those feelings with the PP.
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Matthew19
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Re: Talk me into selling my gold miners.

Post by Matthew19 » Sat Jul 18, 2015 11:13 pm

Thanks Cortopassi. What really erks me is GTU and CEF. I was buying those at a premium and they've tanked worse than the metals themselves, now trading at a negative NAV. Even gold stocks that only own good don't behave like gold if they are a closed end fund!

I liquidated my Europac account last week. The broker asked what I planned to do and then told me that the next hot thing was in cyber security (this is after making about 0% a year for me the past 5 years) I smiled and said thanks for the tip!

I'm looking forward to being free of past mistakes.
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Re: Talk me into selling my gold miners.

Post by Pointedstick » Sat Jul 18, 2015 11:35 pm

We are often our own worst enemies when it comes to investing. The last individual stock I ever bought was for a company that went bankrupt, taking my investment to zero. That was enough. :)
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Re: Talk me into selling my gold miners.

Post by goodasgold » Sun Jul 19, 2015 7:50 am

In the early 2000s I was inspired to invest in gold after studying one of the first books I read about finance and economics - Pete Peterson's "Running on Empty: How the Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do About It."

I was appalled (and still am) to learn from Peterson how both political parties are driving our country toward a financial gotterdammerung. So I invested in gold mining (or so I thought) by buying VGPMX, Vanguard's Precious Metals and Mining fund.

In 2008 I learned two things: (1) I should have read the fine print about VGPMX: it is heavily involved, not just in gold and silver mining, but also in mining non-precious metals such as copper, and (2) gold mining stocks are "gold's gold" because they make the volatility of real gold seem like child's play.

Lesson learned: I  stay away from the gold miners, except possibly as a tiny portion of a VP.
Last edited by goodasgold on Sun Jul 19, 2015 7:53 am, edited 1 time in total.
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Re: Talk me into selling my gold miners.

Post by Cortopassi » Sun Jul 19, 2015 10:47 am

Matthew19 wrote: Thanks Cortopassi. What really erks me is GTU and CEF. I was buying those at a premium and they've tanked worse than the metals themselves, now trading at a negative NAV. Even gold stocks that only own good don't behave like gold if they are a closed end fund!

I liquidated my Europac account last week. The broker asked what I planned to do and then told me that the next hot thing was in cyber security (this is after making about 0% a year for me the past 5 years) I smiled and said thanks for the tip!

I'm looking forward to being free of past mistakes.
I got sucked into the supposedly safer GTU and CEF as well.  There was a time with GTU that the premium actually moved around quite a bit, and so did PHYS.  I have not checked in a long time, but in my desire to make something of nothing, I successfully sold PHYS at a high premium, bought GTU at a low premium and vice versa.  It worked a couple times until the premiums just got stuck.

Again, when I think back of all the wasted effort and energy to make a buck, I am really shocked at the things I did and the risks I took.  I have about 15 years to make up for my stupidity in stock market investing.

As PS did, and I have done for a couple years now, I will never ever own an individual stock again.  I am still working on my inner hate for Yahoo Finance (why I still go on it at times I don't know) talking about the latest hot stock, Apple, Netflix, Amazon, etc.  To those who can do it and survive well, my hat is off to them.
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Re: Talk me into selling my gold miners.

Post by Libertarian666 » Sun Jul 19, 2015 9:35 pm

Matthew19 wrote: Thanks Cortopassi. What really erks me is GTU and CEF. I was buying those at a premium and they've tanked worse than the metals themselves, now trading at a negative NAV. Even gold stocks that only own good don't behave like gold if they are a closed end fund!

I liquidated my Europac account last week. The broker asked what I planned to do and then told me that the next hot thing was in cyber security (this is after making about 0% a year for me the past 5 years) I smiled and said thanks for the tip!

I'm looking forward to being free of past mistakes.
That was an easy mistake to avoid. Just follow the rule never to buy a closed-end fund at a premium.
Don't thank me, it's a public service. :P
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Re: Talk me into selling my gold miners.

Post by mathjak107 » Mon Jul 20, 2015 4:01 am

Cortopassi wrote:
Matthew19 wrote: Thanks Cortopassi. What really erks me is GTU and CEF. I was buying those at a premium and they've tanked worse than the metals themselves, now trading at a negative NAV. Even gold stocks that only own good don't behave like gold if they are a closed end fund!

I liquidated my Europac account last week. The broker asked what I planned to do and then told me that the next hot thing was in cyber security (this is after making about 0% a year for me the past 5 years) I smiled and said thanks for the tip!

I'm looking forward to being free of past mistakes.
I got sucked into the supposedly safer GTU and CEF as well.  There was a time with GTU that the premium actually moved around quite a bit, and so did PHYS.  I have not checked in a long time, but in my desire to make something of nothing, I successfully sold PHYS at a high premium, bought GTU at a low premium and vice versa.  It worked a couple times until the premiums just got stuck.

Again, when I think back of all the wasted effort and energy to make a buck, I am really shocked at the things I did and the risks I took.  I have about 15 years to make up for my stupidity in stock market investing.

As PS did, and I have done for a couple years now, I will never ever own an individual stock again.  I am still working on my inner hate for Yahoo Finance (why I still go on it at times I don't know) talking about the latest hot stock, Apple, Netflix, Amazon, etc.  To those who can do it and survive well, my hat is off to them.
i don't buy individual stocks as investments ,only speculation and fun.

i learned a long time ago i am not smart enough to know when to buy  just the right company , at just the right time , in just the right sector in just the right market sentiment  .

then they miss earnings by a nickel and plunge 10 or 15% .

even if i got all the above right , i have no clue what the competitors are doing .

investing is hard enough without taking on individual company risk too.


i only use diversified funds over many markets  just because i am not smart enough to  introduce individual company risk in to my serious investing .
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Re: Talk me into selling my gold miners.

Post by dualstow » Mon Jul 20, 2015 7:24 am

Matthew19 wrote: I'm having a real mental problem realizing my 70k loss in gold miners to raise funds for the PP. I can't friggin believe it.
That is a big loss and I feel for you. Perhaps you could realize a chunk of it each year and it'll be less painful?
That's what I did with Bank of America stock.
traveling...
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Matthew19
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Re: Talk me into selling my gold miners.

Post by Matthew19 » Mon Jul 20, 2015 3:17 pm

Welp, after the past two huge down days I had 85k in losses. I realized about 70k of them and them today. I kept just enough  as a VP so if miners rebound I won't feel completely stupid. Putting some stop losses in them though.

On the plus side I paid off my mortgage today. So now to implement the PP and stash the mortgage payments into savings. Much more simple and I do feel better! 
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Re: Talk me into selling my gold miners.

Post by Pointedstick » Mon Jul 20, 2015 3:28 pm

Congrats, Matthew, If you fell better, that's what matters. And welcome to the mortgage-free club!
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Re: Talk me into selling my gold miners.

Post by Tyler » Mon Jul 20, 2015 3:34 pm

Congrats!  Paying off the mortgage is a great accomplishment.  So is deciding on an investment plan that works well for you both financially and emotionally.
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Re: Talk me into selling my gold miners.

Post by Cortopassi » Mon Jul 20, 2015 3:44 pm

Congratulations.  I have not had a mortgage since 2006, and it is a great feeling.  Property taxes though, are insane in Cook County, IL.

Well, gold got to finish the NY day under 1100.  Wow.  All the news stories out there now are about how low can it go.

Wonder what we are in for, a few more days/weeks/months and what the final level will be.  Regardless, the beatings will continue until morale improves.
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