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"You just keep me hold'in on"....the gold fund........
FSAGX, and having sold half of the position several weeks ago; apparently the dollar will remain stonger and no black swans have taken flight. 'Course just about a day after selling the remainder will find an up spike, eh? Sure does look the money could be doing real work. Is our house the only one remaining to hold a gold fund? Take care, Catch
I keep finding reasons to buy USAGX each time the market hammers it...a steady repositioning of small winnings elsewhere in my portfolio into this "tumbling down the mineshaft" PM fund. I call this investment approach the "falling knife approach to dollar cost averaging with a reallocation twist". Also known as the "Wing and a Pray" strategy.
Some people like to store their gold in secure underground vaults...I just prefer the unprocessed natural form. I do keep my PM allocation percentages at about 5% of my overall portfolio. As they cave, I back fill.
Finally, I balance this with what Mark Twain had to say:
"A mine is a hole in the ground with a liar standing next to it"
I'm totally out of my admittedly shallow depth with respect to gold funds, but out of curiosity, what is the perceived advantage of USAGX or a similar fund to, say, PRPFX, which also has a gold component and seems to have a much better recent track record? Thanks-
'Course, can't speak for others, but we have been in and out metals funds since the late 70's; including a North American metals fund Fido had that was merged, a number of years ago, into their only metals fund today. As to PRPFX, while we don't hold GLD or related; we have used the metals funds in a similar fashion as another leg mix among equity and bonds. Although pre-2008 found us mostly in equity. We still hold FDLSX for its exposure to McD, Yum, Starbucks and related, as well as the large casinos which have expanded into Macau in the past 2 years. Over the years we have used many of the Fido select sector funds; some cycles being more happy than others. At this period gold and the miner companies are both traveling about the same path; which is not always the case. PRPFX's portfolio is finding the same downward pressure with its metals exposure as the retail investor. Will stay in place with FSAGX for the time being. I am too sleepy; so, will stop now.
PRPFX holds a percentage of gold and silver in bullion form. I assume the fund some how takes possession of these shiny ingots. PRPFX is much more than just a gold and silver metals fund. It balances these holdings of Gold (19%) and Silver(4.6%) with Swiss Franc (9%), Real Estate/Natural Resource Companies(15.6%), Dollar Asset (33.5%) and Aggressive Growth Stocks (16.5%).
My sense is that precious metal (gold and silver) follows the currency markets and global debt risks but, not the vagaries of the equity market where mining companies exist. PM mining companies are expose to lots of other risks such as political risk (of the country in which the mine is located), production risk (is it a hole lot of nothing?), labor risk (workers not happy with their pay), and management risk (is the company run well)...to name a few.
USAGX is purely a mining company fund. Historically the mining stocks have tracked the metals (bullion) pretty closely but sometimes they diverge. As you have commented, the track record of mining companies recently has underperformed the metals by a wide margin.
In the short term either the metals will fall to match the losses of the mining companies or the mining companies will outperform and realign with the metals. I hoping the latter happens. In the long run one has to wonder will the world need and want precious metals. I think so. I could be wrong in both regards but that would only confirm what I already know about my investment abilities.
Here's the short version:
The fact that I haven't seen a horse yet makes the pile of manure all the more valuable.
Per the manure......I will add some words I have heard before, but heard again today for another use; but applies to when an investment is going against us.
A hungry bear is chasing a few folks, including yourself. The thought is that you need to outrun the bear; but all you really must do is outrun the other folks. Problem solved.
Comments
I keep finding reasons to buy USAGX each time the market hammers it...a steady repositioning of small winnings elsewhere in my portfolio into this "tumbling down the mineshaft" PM fund. I call this investment approach the "falling knife approach to dollar cost averaging with a reallocation twist". Also known as the "Wing and a Pray" strategy.
Some people like to store their gold in secure underground vaults...I just prefer the unprocessed natural form. I do keep my PM allocation percentages at about 5% of my overall portfolio. As they cave, I back fill.
Finally, I balance this with what Mark Twain had to say:
"A mine is a hole in the ground with a liar standing next to it"
'Course, can't speak for others, but we have been in and out metals funds since the late 70's; including a North American metals fund Fido had that was merged, a number of years ago, into their only metals fund today.
As to PRPFX, while we don't hold GLD or related; we have used the metals funds in a similar fashion as another leg mix among equity and bonds. Although pre-2008 found us mostly in equity.
We still hold FDLSX for its exposure to McD, Yum, Starbucks and related, as well as the large casinos which have expanded into Macau in the past 2 years.
Over the years we have used many of the Fido select sector funds; some cycles being more happy than others.
At this period gold and the miner companies are both traveling about the same path; which is not always the case. PRPFX's portfolio is finding the same downward pressure with its metals exposure as the retail investor.
Will stay in place with FSAGX for the time being.
I am too sleepy; so, will stop now.
Take care,
Catch
I'll give you the long version first:
PRPFX holds a percentage of gold and silver in bullion form. I assume the fund some how takes possession of these shiny ingots. PRPFX is much more than just a gold and silver metals fund. It balances these holdings of Gold (19%) and Silver(4.6%) with Swiss Franc (9%), Real Estate/Natural Resource Companies(15.6%), Dollar Asset (33.5%) and Aggressive Growth Stocks (16.5%).
My sense is that precious metal (gold and silver) follows the currency markets and global debt risks but, not the vagaries of the equity market where mining companies exist. PM mining companies are expose to lots of other risks such as political risk (of the country in which the mine is located), production risk (is it a hole lot of nothing?), labor risk (workers not happy with their pay), and management risk (is the company run well)...to name a few.
USAGX is purely a mining company fund. Historically the mining stocks have tracked the metals (bullion) pretty closely but sometimes they diverge. As you have commented, the track record of mining companies recently has underperformed the metals by a wide margin.
In the short term either the metals will fall to match the losses of the mining companies or the mining companies will outperform and realign with the metals. I hoping the latter happens. In the long run one has to wonder will the world need and want precious metals. I think so. I could be wrong in both regards but that would only confirm what I already know about my investment abilities.
Here's the short version:
The fact that I haven't seen a horse yet makes the pile of manure all the more valuable.
Per the manure......I will add some words I have heard before, but heard again today for another use; but applies to when an investment is going against us.
A hungry bear is chasing a few folks, including yourself. The thought is that you need to outrun the bear; but all you really must do is outrun the other folks. Problem solved.
I'll keep that in mind the next time my wife and I go camping...