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Mark Hulbert: Here’s The Ideal Amount Of Gold To Keep In Your Investment Portfolio
FYI: Gold should have performed a lot better over the past two years — and especially the past two months. That’s because both periods were characterized by the factors that, according to conventional wisdom, should cause gold to perform well: higher inflation and stock-market turmoil.
I'll ask the question in a different way to MFO members. How have your gold holdings impacted your portfolio over different time frames and different market conditions or events? If it serves as a hedge to certain risks what were those risks? Did gold get converted during those "golden day" and into what?
The article's 4% allocation make me think of the 4% rule. Another way to think of it is have one years income allocated to a hard asset. but maybe more importantly have that hard asset fungible. I recall @rono suggesting having some gold or silver in the form of currency so that it serves two purposes. It represent the value of the metal, but also as a coin it is portable as a medium of exchange...a silver dime or quarter...a gold eagle. Each has a face value and a metal weight value. Numismatic value seems less important during time where you might consider trading the coin for a loaf of bread or passage on the next train.
I was in Hawaii in January when we were told to take shelter. I was on vacation and had neglected to pack my dimes and quarters (sorry @rono) so in that moment I realized I had a whole in my emergency plan pocket.
A few years ago I experience 10 days without electricity in a house that depends on the grid like most homes. Again, a teachable moment. I made some changes at the house. I purchased a 500 gallon propane tank and switch my appliances (stove, dyer, fireplace insert, hot water tank) to use the propane for everyday appliances. The propane also now doubles as a fuel that seamlessly integrates an electric generator into my electrical panel.
When it comes to holding gold and silver as part of a portfolio or emergency plan, I obviously need some coaching, especially away from home. I'd like to hear from others on your "emergency plans" and whether a hard currency plays a part in it.
I believe history shows gold is not a good investment. That said, I believe my robo-portfolio holds 4-5% as a diversifier. Somewhere in their portfolio algorithm Schwab believes it has a place. So-be-it. I personally do not think it's needed, so I don't use it in my self managed.
Emergency plan? Right or wrong, I'm not going to plan for a doomsday scenario. Always enjoyed watching the Mad-Max movies though. Remember Barter Town?
I have a small % of GLD as an inflation and currency hedge. I am not sure it is worth it. I do not have physical gold, as coins seem to expensive, and I can't imagine how I would be able to get my fractional bar out of some vault in NYC if the world came to an end.
Along those lines bee, how many gold coins would you have had to take to Hawaii to make a difference? Assuming that dollars are worthless or the ATMs go down, and you are left standing would the rest of the population starving let you walk out of a grocery store with full bags havng just bought groceries wiith your coins. I doubt the chaos at the airport would allow any flights to take off either.
We heat our small house with wood, so don't mind if the power goes off. I got rid of my propane tank fearing that if it leaked it would accumulate in the basement and blow us up. If we had a generator the racket and smoke and fumes would wake me up everytime the power goes off around here
Comments
I'll ask the question in a different way to MFO members. How have your gold holdings impacted your portfolio over different time frames and different market conditions or events? If it serves as a hedge to certain risks what were those risks? Did gold get converted during those "golden day" and into what?
The article's 4% allocation make me think of the 4% rule. Another way to think of it is have one years income allocated to a hard asset. but maybe more importantly have that hard asset fungible. I recall @rono suggesting having some gold or silver in the form of currency so that it serves two purposes. It represent the value of the metal, but also as a coin it is portable as a medium of exchange...a silver dime or quarter...a gold eagle. Each has a face value and a metal weight value. Numismatic value seems less important during time where you might consider trading the coin for a loaf of bread or passage on the next train.
I was in Hawaii in January when we were told to take shelter. I was on vacation and had neglected to pack my dimes and quarters (sorry @rono) so in that moment I realized I had a whole in my emergency plan pocket.
A few years ago I experience 10 days without electricity in a house that depends on the grid like most homes. Again, a teachable moment. I made some changes at the house. I purchased a 500 gallon propane tank and switch my appliances (stove, dyer, fireplace insert, hot water tank) to use the propane for everyday appliances. The propane also now doubles as a fuel that seamlessly integrates an electric generator into my electrical panel.
When it comes to holding gold and silver as part of a portfolio or emergency plan, I obviously need some coaching, especially away from home. I'd like to hear from others on your "emergency plans" and whether a hard currency plays a part in it.
Emergency plan? Right or wrong, I'm not going to plan for a doomsday scenario. Always enjoyed watching the Mad-Max movies though. Remember Barter Town?
Along those lines bee, how many gold coins would you have had to take to Hawaii to make a difference? Assuming that dollars are worthless or the ATMs go down, and you are left standing would the rest of the population starving let you walk out of a grocery store with full bags havng just bought groceries wiith your coins. I doubt the chaos at the airport would allow any flights to take off either.
We heat our small house with wood, so don't mind if the power goes off. I got rid of my propane tank fearing that if it leaked it would accumulate in the basement and blow us up. If we had a generator the racket and smoke and fumes would wake me up everytime the power goes off around here