Buying Gold for a Taxable Account (Mutual Fund / ETF)

[69Stingray]

Hello everyone, great forum!

First of all, here is my situation.  I have $400/month that I want to store away for 5-7 years for my next vehicle purchase. The PP seems like a perfect portfolio to do this with.  I am trying to find a good brokerage account to do this with. I have having the most trouble with the gold portion.

Here is a similar thread:  http://gyroscopicinvesting.com/forum/in ... opic=749.0

I like the use of index mutual fund because you can set up automatic investments without any additional fees. Gold ETFs have a couple flaws for my situation. (1) Commission cost, (2) No automatic investment (have to do it manually) (3) and have to buy in whole share increments.

Does someone have a mutual fund equivalent to the GLD with an automatic investment plan (and a low initial purchase amount for low additional investment amount).  So far, Fidelity seems to be a good choice except the gold. A No Transaction Fee gold Mutual Fund available through Fidelity would be ideal.

I do not like their Gold Select since it is all common stock of companies involved in gold related activities.

[AdamA]

Have you thought about using PRPFX?

[69Stingray]

Thanks for the reply Adam1226-

I have thought about that fund, I actually makes up approx. 5% of my 401k.

It is an option, I guess I am a little concerned that in the next five years, if the rest of the market does well, a good portion of the money will be flowing out of the fund. This is fine for my 401k, which is long term, with a 5-7 year window I was thinking setting up my own in a brokerage account with some sort of automatic investment would be a better route to go. Buying $50-$100 in gold each month is not practical (even though I understand the concept).

[MediumTex]

I would just find a broker with low trading costs and choose which gold ETF or closed end fund you like and start building your position.

When it reaches a certain threshold you might transition into physical.

[69Stingray]

I would just find a broker with low trading costs and choose which gold ETF or closed end fund you like and start building your position.

Thanks Tex, Sharebuilder seems the best so far. I can setup a ETF based PP and have Sharebuilder automatically buy $400/month. Sharebuilder also does partical shares, which is nice. The down size is the $12/month cost. That is a 3% "load" each month (if you will).

[cabronjames]

I would just find a broker with low trading costs and choose which gold ETF or closed end fund you like and start building your position.

Thanks Tex, Sharebuilder seems the best so far. I can setup a ETF based PP and have Sharebuilder automatically buy $400/month. Sharebuilder also does partical shares, which is nice. The down size is the $12/month cost. That is a 3% "load" each month (if you will).

A few random ideas that should be superior to Sharebuilder

What about accumulating in cash for 12 months, & then buying up the trailing asset(s)?  This way you would only have at most 1, gold ETF/closed end fund, transaction cost per year.

Or add new contributions to cash.  Reblance when you hit the 15/35% rebalancing bands, which may happen somewhat regularly to your new contributions going into cash.  It could be if cash hits 35% of the portfolio, or some other level you decide such as 30% of portfolio.