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Ohio Pension Fund jumps into gold market with 5% allocation
“Growing uncertainty surging through global financial markets is helping to shine a spotlight on the gold market as more generalist investors and funds look for safe-haven assets.According to media reports, the Ohio Police & Fire Pension Fund (OP&F) approved a 5% allocation into gold in a move to diversify its portfolio and hedge against the risk of inflation. The fund currently holds about $16 billion in assets under management. The gold recommendation was made by the fund's investment consultant, Wilshire Associates,” Story
Dunno @Derf. I’ve asked myself that question a lot lately. Wouldn’t you have to be a little nuts to throw $$ at a mining fund that’s already gained 50+% in the past year? However, some pretty smart people are saying “buy!” Would the experts here please weigh in?
I don't think it mentions mining funds, just gold. Likely gold ETFs like GLD or IAU. Much tamer than miners. I'm surprised a diversified portfolio like a pension plan wouldn't have something in gold already.
Exactly. One would think the investment committee would have a more elaborated approach to hedge against multiple market scenarios. Precious metals should be in their playbook long ago. Think they are late.
I happen to belong to small union that bought diamonds to diversify . Long story short. Instead of buying one of the best , high quality , numerous smaller stones were purchased. Pension fund dropped the ball on that deal & lost a bundle !! That caused union to find a financial advisor instead of members input .
@MikeM, Good points. I understand there’s a difference between miners and the metal. They do tend to run together - but the mining stocks / funds are more volatile, as you’ve noted before. I’ve messed around off and on with OPGSX - one of the better mining funds - because I happen to invest at that house. I bailed 100% from it a month ago at a NAV of $30.08. I’ve since made a couple small token buys back in as it fell quite a bit after I sold. Today it closed at $3.12 . I don’t have any predictions for the metal or the fund. Might nibble more on a big pullback.
As for gold itself, here’s a 10 year price chart. Notice how erratic the price has been. The article I linked was very vague. I suppose we must assume they bought the metal in some form. While 5% doesn’t sound like much, gold tends to be so volatile that I’d call 5% a pretty good sized slug. I linked the story, of course, just to portray this recent trend in investing. As others here have noted, if the Ohio pension fund had been more prescient they’d have bought their gold a year ago for 30 or 40% less.
Chart covers gold’s price the past decade. Looks like it began this year around $1500-$1550. Today, it’s just shy of $2,000. I think it’s the very low interest rates that have investors looking for alternatives of all types. Also, some think the approaching election turmoil / possibly shooting in the streets, will propel gold to new highs. Ughh ...
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Dunno @Derf. I’ve asked myself that question a lot lately. Wouldn’t you have to be a little nuts to throw $$ at a mining fund that’s already gained 50+% in the past year? However, some pretty smart people are saying “buy!” Would the experts here please weigh in?
That caused union to find a financial advisor instead of members input .
Shit Happens, Derf
As for gold itself, here’s a 10 year price chart. Notice how erratic the price has been. The article I linked was very vague. I suppose we must assume they bought the metal in some form. While 5% doesn’t sound like much, gold tends to be so volatile that I’d call 5% a pretty good sized slug. I linked the story, of course, just to portray this recent trend in investing. As others here have noted, if the Ohio pension fund had been more prescient they’d have bought their gold a year ago for 30 or 40% less.
Chart covers gold’s price the past decade. Looks like it began this year around $1500-$1550. Today, it’s just shy of $2,000. I think it’s the very low interest rates that have investors looking for alternatives of all types. Also, some think the approaching election turmoil / possibly shooting in the streets, will propel gold to new highs. Ughh ...