ScrapMetal wrote:Far from being an expert, but wouldn't the stock market be a better bet than PMs?
I love the fact that I can hold in my hand gold and silver, but they produce no income until sold, and then it is gone.
What is an acceptable increase in value that supports the risk? If you have to hold PMs for 3 or 4 years for a 20% profit is that considered good?
I have changed my views on PMs, not an investment but as wealth preservation. Looks like they will drive the value of the dollar to record lows.
PMs have always been wealth preservation - mostly. There is an argument to be made - when enough people consider them temporarily "undervalued" - to attempt to consider them as investment, but such a view is fraught with all the usual issues of accuracy of that view, and market timing, etc. I do consider most PMs to be undervalued in the long term, but not enough (at this point) to cause me to consider them true investments. I focus on the wealth preservation aspect, but I also know that if they are in fact undervalued, then I *might* see an appreciation as well, and that at little risk because they will not drop to zero, and the odds are they won't drop below where I have my basis value - which makes them near zero risk. In such a scenario, a 20% profit looks good, because frankly the risk of being in almost anything else except hard assets in these days is (in my view) quite high, with a non-zero risk that one could lose everything that is cash or paper based.
On the other hand, if I was quite a bit younger (than I am these days), I would be more willing to gamble (the stock market) with a somewhat larger portion of my stake than I do now, because if I lost that gamble I would have more time to recover my stake to try again in something else. So a lot of it has to do with where you are in life.
Posted: Sun Aug 08, 2021 8:39 pm