Gyroscopic Investing

Ad Orientem wrote: I encourage holding at least some physical gold as a hedge against something really really bad happening. Call it disaster insurance. In an SHTF scenario financial markets might be closed and you might have difficulty redeeming paper shares of gold. In general I am not one of the conspiracy gold bugs who are convinced the ETFs are all frauds. I think that's silly. Too many people would have to be in on something that big and someone would blab. But that doesn't mean there aren't counter-party risks.

All things said as long as we don't have a disaster, ETFs are probably fine. And they admittedly are a lot more convenient. But even if you use an ETF I'd try to buy some coins when you are rebalancing into gold. You can use the ETF for rebalancing out.

PP67 wrote: Has anyone bought (or tried to buy) physical gold recently?  Someone in my office went down to a fairly large dealer a couple of days ago and could not buy anything for any price...  For those of you who did buy, what premium did you have to pay?

With the recent market upheaval, the U.S. Mint as well as private mints are not able to keep up with the demand causing premium swings and incredbly slow delivery times. Please be advised there is a serious backlog of material and we are doing our best to have SOMETHING to offer in both Gold & Silver products. Please note our increased bids for all silver products.

MachineGhost wrote: It looks like 1oz bars have the lowest premium above spot right now.  Whats the point in paying a higher premium just to get a common gold coin?

k9 wrote: I'm only holding physical gold. I don't like having too many people between my assets and I, especially with gold (which is supposed to protect me against financial & political maëlstroms). I think I could cope with a little part of it with ETFs, for rebalancing reasons, but I haven't done it yet (I don't sell gold yet, only buy some more or not, because my portfolio is still very small and taxes are very dissuasive in France for ETFs).

frugal wrote: In Europe is not that easy to sell the bars or coins.

Pointedstick wrote:

frugal wrote: In Europe is not that easy to sell the bars or coins.

Why not, out of curiosity? Can't you just walk over to a dealer and sell them? Also in the USA you can mail them to one of the sellers like Goldmart or APMEX; aren't there any European gold dealers that offer the same service? I don't understand why it should be any more difficult for Europeans than it is for Americans.

frugal wrote: now with crisis Gold dealers increased a lot

but I don't know if they will persist after all the private gold sales that happened in the last years

stuper1 wrote: But do the gold bars have the lowest spread?  From what I've seen, the American Eagles and the Krugerrands have the lowest spread, so you pay less of a premium between your buy and sell points.  Also, the coins are harder to counterfeit than a bar.

dualstow wrote:

MachineGhost wrote: It looks like 1oz bars have the lowest premium above spot right now.  Whats the point in paying a higher premium just to get a common gold coin?

I thought the point of owning coins was their common-ness. Aren't they easier to sell?
I have never bought bars, but I thought coins were the only recommended physical form.

frugal wrote:

k9 wrote: I'm only holding physical gold. I don't like having too many people between my assets and I, especially with gold (which is supposed to protect me against financial & political maëlstroms). I think I could cope with a little part of it with ETFs, for rebalancing reasons, but I haven't done it yet (I don't sell gold yet, only buy some more or not, because my portfolio is still very small and taxes are very dissuasive in France for ETFs).

How would you sell all it?

In Europe is not that easy to sell the bars or coins.

MachineGhost wrote:

stuper1 wrote: But do the gold bars have the lowest spread?  From what I've seen, the American Eagles and the Krugerrands have the lowest spread, so you pay less of a premium between your buy and sell points.  Also, the coins are harder to counterfeit than a bar.

Are you saying the premium to buy or sell isn't one half of the spread, but an extra charge?  I thought they were the one and the same, hmm!

k9 wrote:

frugal wrote:

k9 wrote: I'm only holding physical gold. I don't like having too many people between my assets and I, especially with gold (which is supposed to protect me against financial & political maëlstroms). I think I could cope with a little part of it with ETFs, for rebalancing reasons, but I haven't done it yet (I don't sell gold yet, only buy some more or not, because my portfolio is still very small and taxes are very dissuasive in France for ETFs).

How would you sell all it?

In Europe is not that easy to sell the bars or coins.

Well, it's harder but it's not that hard either
Currently, you can go

- to the bank (rather expensive),

- to a local dealer (there are quite a few in any big city, at least in France -- you can at least go to Paris if you have quite a lot of coins to sell and have a good price ; I know Brussels has a lot of dealers too). The more you sell, the better price per oz you get,

- or you can sell it to an individual investor through internet, craigslist & al. work quite well, provided buyer and seller physically meet each other and conclude the transaction this way. This is a little more complicated, you have to be able to detect fake coins when you're the buyer and choose a safe place to conclude the transaction, but you have amazingly interesting prices : you skip both the dealer's fees and the government's taxes (but shush, I didn't say that of course). This is more adapted to rather small amounts, for security reasons.

So, for small amounts (up to, say, 10 oz) -> investor to investor ; for big amounts (wow, gold bars ? I've never seen any ) -> gold dealer, at worse in your country's capital city, or a bank if nothing else is possible.

That's not very convenient, but, honestly, you don't sell gold that often and, if you do, that's because you hit a rebalancing band, so that means you're making a lot of money in the trade. If you're investing 50% physical-50% ETF and use 35-15 bands, that will probably never happen unless SHTF.

frugal wrote: what spreadsheet you use to follow your PP ?

1. Future projections of how much my PP/VP will be worth each year between now and retirement, factoring in all variables such as increases in the 401K/IRA limits, fluctuations in the markets, inflation, and any other variables I discover.  I just like having a thumbnail idea of whether or not I'm likely to hit my targets.
2. The "master" spreadsheet, where I track the holdings in each of my accounts (and my wife's accounts).  This is my most critical spreadsheet, the one I can't live without.  It houses all the pertinent data about each fund.  I also categorize them as to which asset of the PP they fall under, if any (for our 401K accounts, where our choices are limited).
3. A "modeling" spreadsheet that pulls data from my "master" spreadsheet and enables me to determine when and where I need to rebalance.
4. A "target" spreadsheet where I can see an overview of exactly how my overall holdings break down into the various PP/VP categories.  This is where I can get a sense of whether I might have too much in bonds, or too much foreign exposure, etc.
5. A "tracking" spreadsheet, where I track various market indexes along with my portfolios each month, to see how I'm stacking up.
6. An "allocation" spreadsheet that aggregates investing advice from every source I come across.  So if I read a book that provides advice on asset allocation, I add it to this spreadsheet.  I then calculate stats like averages, medians, percentages, ranges, and so on.  This gives me an overall feel for what the general consensus is as far as asset allocation.

frugal wrote: what spreadsheet you use to follow your PP ?