Gyroscopic Investing

dualstow wrote: Either I'm reading the wrong numbers, or tech's going to have a biiiig smile on his face this morning.

I don't think you are reading the wrong numbers. 

But of course being the big worrywart that I am, I can't help but wonder whether this is a spike that will disappear shortly. 

Libertarian666 wrote:

dualstow wrote: Either I'm reading the wrong numbers, or tech's going to have a biiiig smile on his face this morning.

I don't think you are reading the wrong numbers. 

But of course being the big worrywart that I am, I can't help but wonder whether this is a spike that will disappear shortly. 

Is this recent rise driven by fundamentals? I know stocks got pounded again in Asia and, to a lesser degree, in Europe so far today. Don't get me wrong... I am happy to finally see gold doing well again. I just don't get why it's performing well. Inflation? A real threat to the USD? Just no other place to put one's damn money with stock and bond valuations still being high and cash not paying anything? I want it to make sense, damn it!  Is it just on a friggin' random walk?

The other thing I am curious about is why gold and long bonds are moving up together. Is it negative real rates? I know the sample size is small (basically since the calendar flipped to January).

barrett wrote: The other thing I am curious about is why gold and long bonds are moving up together. Is it negative real rates? I know the sample size is small (basically since the calendar flipped to January).

The effect of all the negative interest rate talk seems like a no-brainer for rising long bond prices. As for gold, negative rates also sounds like a doom and gloom scenario so that would be my guess.

Talk me out of selling a portion of my gold position this morning...

buddtholomew wrote: Talk me out of selling a portion of my gold position this morning...

Hi, I'm Budd. You may know me from such threads as "I'm done!"

Well, in all seriousness, only you can make that decision. What I do is to tell myself: Gold is very likely to go back down again before it goes up, and it will hurt. Do I want to take profits now or stay in it for the big rise in the future?
It's a little easier for me, because I have no profits, but I'm staying in, of course. May want to buy more when it calms down, if I can find the cash.

I thought your gold was down 10%. Are there pieces of it that just broke even or something?

buddtholomew wrote: Talk me out of selling a portion of my gold position this morning...

Are you using the PP as an investor or a speculator?

I can almost guarantee you that if you sell your gold this morning you will be kicking yourself in a month or a year.  That's just my strong intuition.

Just let the PP do its thing, and when you hit a rebalancing point, rebalance.

MediumTex wrote: Just let the PP do its thing, and when you hit a rebalancing point, rebalance.

The only issue with this is when you pay just enough attention to the markets to watch your positions almost reach their rebalancing bands, but you don't rebalance, and of course they reverse direction and you're left dreaming of the market timing that might have been.

But I guess that's just part of the deal, and true of any strategy.

Gooooold! 

flyingpylon wrote: The only issue with this is when you pay just enough attention to the markets to watch your positions almost reach their rebalancing bands, but you don't rebalance, and of course they reverse direction and you're left dreaming of the market timing that might have been.

I agree. That is the worst.

MediumTex wrote:

buddtholomew wrote: Talk me out of selling a portion of my gold position this morning...

Are you using the PP as an investor or a speculator?

I can almost guarantee you that if you sell your gold this morning you will be kicking yourself in a month or a year.  That's just my strong intuition.

Just let the PP do its thing, and when you hit a rebalancing point, rebalance.

I sold 10% of my gold allocation this morning to avoid any regret.
It won't matter either way monetarily, but psychologically it will make all the difference.
All assets are now at +/- 25% and FI duration back to 5.6 with cash from the sale.

Sorry MT.

buddtholomew wrote:I sold 10% of my gold allocation this morning to avoid any regret.

No selling!  I want my gold to go higher, not lower.  :-)

More seriously: at the end of 2015 I did some loss harvesting, selling IAU and buying GTU (now PHYS).  I don't believe the wash sale rule applies to gold, but I wanted to avoid any possibility of that, as well as confusion about that on the part of the broker.  GTU was selling at a small discount at the time.

According to http://www.morningstar.com/cefs/ARCX/PHYS/quote.html , PHYS is now trading at a premium of .61%, as of 2/9.  I'm guessing that's higher today.

Is this a good time to sell my PHYS and get back to IAU (for the lower expense ratio)?  Does anybody know whether there's any such thing as real-time premium/discount information?

Holy crap guys, this is ridiculous!

Buy some GLD puts to hedge your position if you feel the need to.

It does feel out of control, "must be slammed down" but, wow what a rise the past few days. 

PP did 4.04% for me in 2014, -3.26% in 2015 and right now 4.44% up for 2016.  I swear, part of me wants to say sell everything, and just get back in in 2017!

Just thinking that the nice thing about having a portfolio that is balanced is that it allows you to stay invested and not miss moves like this. Sometimes a year's worth of gains can occur in a very short time.

I'd also love to know where/who the majority of buyers are at the moment.

barrett wrote: Just thinking that the nice thing about having a portfolio that is balanced is that it allows you to stay invested and not miss moves like this. Sometimes a year's worth of gains can occur in a very short time.

I'd also love to know where/who the majority of buyers are at the moment.

Most likely short covering.

Tyler wrote: Gooooold! 

You can say that again, Tyler. I rolled over most of my stake  into the PP in early 2013, not long before the yellow stuff took its first stomach-turning dive. The past three years (except for 2014)have not been terribly encouraging, until now.

Yeah, baby! It's days like this that tell me to drop in at the ol' bank vault and run those lovely kangeroos and eagles through my fingers while I cackle like Donald Duck's goldbug uncle, hoping those sunbright disks of loveliness hit the table with a satisfying ring, not the dull thud indicating they are some of those newfangled tungsten fakes. 

If only GTU had held out for a few more months the fund would likely be selling at a premium now, invalidating Sprott's under-performance claim.  What a shame.

goodasgold wrote: Yeah, baby! It's days like this that tell me to drop in at the ol' bank vault and run those lovely kangeroos and eagles through my fingers while I cackle like Donald Duck's goldbug uncle, hoping those sunbright disks of loveliness hit the table with a satisfying ring, not the dull thud indicating they are some of those newfangled tungsten fakes. 

I was there yesterday, but it was to deposit a tube, my late January purchase. 

barrett wrote:

Libertarian666 wrote:

dualstow wrote: Either I'm reading the wrong numbers, or tech's going to have a biiiig smile on his face this morning.

I don't think you are reading the wrong numbers. 

But of course being the big worrywart that I am, I can't help but wonder whether this is a spike that will disappear shortly. 

Is this recent rise driven by fundamentals? I know stocks got pounded again in Asia and, to a lesser degree, in Europe so far today. Don't get me wrong... I am happy to finally see gold doing well again. I just don't get why it's performing well. Inflation? A real threat to the USD? Just no other place to put one's damn money with stock and bond valuations still being high and cash not paying anything? I want it to make sense, damn it!  Is it just on a friggin' random walk?

Listen, grasshopper: What is the definition of a US dollar?
Answer that and you will know the secret of gold.

Pointedstick wrote: Holy crap guys, this is ridiculous!

Only if you don't understand money.

MWKXJ wrote: If only GTU had held out for a few more months the fund would likely be selling at a premium now, invalidating Sprott's under-performance claim.  What a shame.

My thought exactly.  I was planning to tax-loss harvest gold at the end of the month when I do my annual check-up.  I guess I'm still down 15% or so total, but now my last 1-2 lots are above water.

Things may drop again tomorrow, but what a day. Time to celebrate.

Almost triple the average volume on IAU today.

A few more days like this....