Gyroscopic Investing

Man,sometimes it's just so unreal.
Be cool.Try and watch the big picture.Pray.
Be kind to our fellow investors.

frank

I must say after two negative years, it is fun to watch gold's big up trend these past days make the nay sayers uncomfortable. 

My gold is under water less than 10%!!!   Started in Mid-2012, increased allocation from 15% to 25% early this year (for the part of retirement funds PP-ish.)

dragoncar wrote: I was four weeks away from rebalancing!  Four weeks!  I guess anything can happen in that time but still...

I keep thinking about this post. Gold goes up after a long down period which kinda rebalances your portfolio passively, right? Is your regret that you didn't actively rebalance? I'm interested because, after a year of being invested in the PP, I am at 4X25 because I contributed new money to the lagging asset (gold) and got freaked out and sold a few treasuries when they were at 3%. Now I feel as if I should maybe do something but there is nothing to do, except go out and make more money so that I can make new contributions.

The recent rise in the price of gold is indeed gratifying, but we realist, non-emotional, squinty-eyed Clint Eastwood PP types (and what would be a suitable female counterpart for lady PPers??) need to keep in mind the possibility of price drops as well. On a yearly basis, the only gold price that counts is the one at the closing bell on Dec. 31 of each year.

As an illustration, let's keep in mind the fact that gold rose by 15% in early 2014, only to end the year with a slight loss. But in the long run I think we are wise to stick to our PP principles, rebalancing when our individual plan calls for it.

As the song goes:

"You gotta know when to hold 'em
  Know when to fold 'em
  Know when to walk away
  Know when to run.
  You never count your money
  When you're sittin' at the table
  There'll be time enough for countin'
  When the dealin's done."

goodasgold wrote: The recent rise in the price of gold is indeed gratifying, but we realist, non-emotional, squinty-eyed Clint Eastwood PP types (and what would be a suitable female counterpart for lady PPers??)

barrett wrote:

dragoncar wrote: I was four weeks away from rebalancing!  Four weeks!  I guess anything can happen in that time but still...

I keep thinking about this post. Gold goes up after a long down period which kinda rebalances your portfolio passively, right? Is your regret that you didn't actively rebalance? I'm interested because, after a year of being invested in the PP, I am at 4X25 because I contributed new money to the lagging asset (gold) and got freaked out and sold a few treasuries when they were at 3%. Now I feel as if I should maybe do something but there is nothing to do, except go out and make more money so that I can make new contributions.

barrett, you and I are similar in this regard.

All assets are well within tolerance bands, but I have this constant urge to exchange a portion of long-term treasuries for cash. I may acquiesce to silence the voices in my head and exchange 5% worth of LTT's in tax-deferred (1% of portfolio). I wouldn't consider this if the bonds were held directly and not through the TLT ETF.

MangoMan wrote:

barrett wrote:

dragoncar wrote: I was four weeks away from rebalancing!  Four weeks!  I guess anything can happen in that time but still...

I keep thinking about this post. Gold goes up after a long down period which kinda rebalances your portfolio passively, right? Is your regret that you didn't actively rebalance? I'm interested because, after a year of being invested in the PP, I am at 4X25 because I contributed new money to the lagging asset (gold) and got freaked out and sold a few treasuries when they were at 3%. Now I feel as if I should maybe do something but there is nothing to do, except go out and make more money so that I can make new contributions.

Excellent point. I agree that psychologically, contributing to the lagging asset helps quash the constant nagging feeling that you are rebalancing either too early or too late. It also helps avoid rebalancing in general, which is a good thing if most of your assets are in taxable accounts.

Yep I have never hit rebalance bands (excluding cash) because I contribute to the lagging asset.  But I called it a rebalance because I basically accumulate cash and then top up the other assets once a year (just a function of my savings rate vs holdings... If I made more money I guess I'd do it twice a year or whatever).

I'm just thinking that if I had bought gold on jan 1 I'd be better off than If I buy on feb 1

Pointedstick wrote:

goodasgold wrote: The recent rise in the price of gold is indeed gratifying, but we realist, non-emotional, squinty-eyed Clint Eastwood PP types (and what would be a suitable female counterpart for lady PPers??)

Excellent, but what about River? That fight scene in the bar has to be one of the best ever, but maybe not as impressive in a still picture...

Sigourney Weaver as Ripley in Alien(s) with that Mech suit.

dualstow wrote: Sigourney Weaver as Ripley in Alien(s) with that Mech suit.

Yes! And here is a suitable sound bite from the movie:

"That's the only way. We'll move in pairs. We'll go step by step and cut off every bulkhead and every vent until we have it cornered. And then we'll blow it the f*ck out into space! Is that acceptable to you?"

What a great tag line.

dualstow wrote: Sigourney Weaver as Ripley in Alien(s) with that Mech suit.

Well, it is pretty much settled that Clint Eastwood represents the average PPer (male division), at least when he was a bit younger.

And all of the suitable candidates (and the suit is very important) for the role of the true PPer (female division) listed so far are quite appropriate.

Maybe it shows my age, but I have more in mind Ms. Emma Peel from the old Avengers show:

https://www.google.com/search?site=&tbm ... 1zUfWa3ums

Perhaps someone on this list better endowed than I with tech savvy could choose their favorite image of Ms. Peel from the URL shown above and post it in all its glory.

goodasgold wrote:

dualstow wrote: Sigourney Weaver as Ripley in Alien(s) with that Mech suit.

Well, it is pretty much settled that Clint Eastwood represents the average PPer (male division), at least when he was a bit younger.

And all of the suitable candidates (and the suit is very important) for the role of the true PPer (female division) listed so far are quite appropriate.

Maybe it shows my age, but I have more in mind Ms. Emma Peel from the old Avengers show:

https://www.google.com/search?site=&tbm ... 1zUfWa3ums

Perhaps someone on this list better endowed than I with tech savvy could choose their favorite image of Ms. Peel from the URL shown above and post it in all its glory.

How about this?

Libertarian666 wrote:

goodasgold wrote:

dualstow wrote: Sigourney Weaver as Ripley in Alien(s) with that Mech suit.

Well, it is pretty much settled that Clint Eastwood represents the average PPer (male division), at least when he was a bit younger.

And all of the suitable candidates (and the suit is very important) for the role of the true PPer (female division) listed so far are quite appropriate.

Maybe it shows my age, but I have more in mind Ms. Emma Peel from the old Avengers show:

https://www.google.com/search?site=&tbm ... 1zUfWa3ums

Perhaps someone on this list better endowed than I with tech savvy could choose their favorite image of Ms. Peel from the URL shown above and post it in all its glory.

How about this?

Yes, that pic of Emma is terrific. And let's consider it a triumph of PPer good sense and consensus that the nomination of a (younger) Clint Eastwood was accepted, without any grumbling or dissent, as representative of the average PPer (male division.)

May this spirit of harmony continue now that a suitable pic of Emma Peel has been nominated as representative of the average female PPer!

goodasgold wrote: As the song goes:

"You gotta know when to hold 'em
  Know when to fold 'em
  Know when to walk away
  Know when to run.
  You never count your money
  When you're sittin' at the table
  There'll be time enough for countin'
  When the dealin's done."

I sure miss those Kenny Rogers roast beef sandwiches.  Arby's has nothing on 'em!

Bought some GTU in my Roth today. I have not been good about rebalancing all at once.

dualstow, did your bonds reach the 35% band?

Reub wrote: dualstow, did your bonds reach the 35% band?

Prepare for a longwinded answer, considering this is a gold thread.  The short answer is that it was during the last stock rebalance that I did not buy enough gold. It was kind of a 12-month rebalance as well.

Nope. My bonds are about 28%. And because I have fiddled, I have the dilemma of deciding whether to ignore that I fiddled or to correct for that fiddling (unfiddle).

In the past, I swapped TLT and EDV for directly held treasuries. No real tax consequences. I just wanted something that I could feel better about holding if bonds really crashed, which I thought they would.

More recently, I unloaded my last TLT shares bought at ~$125 (at breakeven), but I didn't have the heart to buy new bonds. To my amazement, of course, TLT is now at 135. So I don't know if I should rebalance at 35% or if I should plug the sold TLT, call them ghost shares, into the formula and sell when that bond total including ghost bonds hits 35%.

In the end, I will probably sell something at 30%. Best bonds are up 43%, worst are up 4.5% I never dreamed these latter bonds would ever be in the black. Soooo happy with bonds.

Because many of us have "fiddled" I wish that there were a more standardized method of determining when to rebalance the PP. I know that we have all entered on this ride at different points, however there must be a way to create a rebalancing point and time that we could all follow based on market moves and not individual moves.

You mean like Annual Rebalance Day?

I mean, there is a standardized method: the bands. I'm better at adhering to them with stocks, but I usually cave with the other assets. I mean, how often does one get a chance to rebalance bonds. If we fiddled with the bands, why wouldn't we also fiddle with a different set of rules?

Of course we should not all be rebalancing at the same time except for those who do so annually and happen to choose the same approximate time.

The bands are based on when we invested and fiddled individually. I'm talking about a system of rebalancing based on the strengths and weaknesses of the underlying assets irrespective of when we personally entered or fiddled.
I guess that would involve market timing.

Reub wrote: I guess that would involve market timing.

And time travel.

Reub wrote: The bands are based on when we invested and fiddled individually. I'm talking about a system of rebalancing based on the strengths and weaknesses of the underlying assets irrespective of when we personally entered or fiddled.
I guess that would involve market timing.

What's wrong with the bands on the indexes?  That's reference.  Just start it from 1968.

Whoa. Did gold just sink to 1240?

My impression is that every time stocks win back like 10 points from a dip, gold and bonds lose 100 - 200.

I guess pros buy up gold and treasurys when stocks are in a short slump, then use stocks as an indicator of when to liquidate those holdings.