Taking out a personal loan to invest in Gold

atush

jimjames wrote: »

Is anyone selling? How many ETFs have to hold the actual gold that people are buying by holding their shares?

If it isn't actual gold then surely that is another risk and possible explain why there isn't as much actual selling

Yes, Some are and have been selling. Me as a case in point.

I sold half my holding earlier this year. Mainly because my investment was over 100% in profit and I wanted to turn that 'paper profit' into real profit as I had bought gold some years back when it was less than $700 per oz. But I wasn't bearish on gold, and it had risen and fallen both before and after I sold. And I did keep half. but it is never wrong to bank profits. But I am going to hold the other half till it is over 2000.

ncollier1

Borrowing to speculate is OK if you can borrow at 0.5% and you have a government to bail you out if it all goes wrong, but to take a consumer loan - you are already 8% out of pocket - too far behind the starting line to make it worth it. And that leaves aside the question of the increased risk due to this leveraging. 99% of the time if you only invest what you have you will be much better off and much happier. And I speak from experience.

paul5046

ncollier1 wrote: »

Borrowing to speculate is OK

No it is not.

atush

Anyone rmember th e John Grisham novel The Rainmaker?

Where young lawyer Rudy come upon the Stupid, Stupid, Stupid letter?

I feel like writing that letter now lol!

Jegersmart

dunstonh wrote: »

If anyone wants signs that its time to get out of gold, then its threads like this.

Gearing into a single asset after a massive price boom which is now fashionable is damned high risk.

I can only agree very strongly with this post.

shaun_from_Africa

Originally Posted by ncollier1
Borrowing to speculate is OK

paul5046 wrote: »

No it is not.

The above quote is a perfect example of how copying only a small part of a sentence can completely change it.

Borrowing to speculate is OK if you can borrow at 0.5% and you have a government to bail you out if it all goes wrong,

cepheus

deutsch wrote: »

This long term loan, would be a long term investment in Gold for 5 years.

I just have a feeling for the next half decade, Gold is going to shoot up so much more than the low interest rate loans that are available.

I have money to invest in gold, but combining it with a loan, would mean I could buy more.

Sounds crazy to me. However....

Assuming you are willing to take a risk on the price of gold, rather than take out a loan and buy gold, you could simply take out a spread bet for the equivalent amount which would probably work out cheaper. The interest will be typically 2 or 3% at present rates and you will only have to put up a small part of the exposure, the remainder could go in an instant access account earning slightly more. You can arrange the overall package so it is no more geared than if you bought the gold.