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Gold and Silver advice
Comments
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I just don't get why folk who buy precious metals get so much negativity? I'm not banking my future on anything.
There is a tendency for people to "ramp up" the price of metals on forums such as these. I think the risk is a newbie might come in and see loads of people posting about how gold/silver/etc is bound to go up.
Also there is a tendency for precious metal buyers to be negative about every other asset class and to have extreme views on fiat currency, etc.0 -
Your friend completely misunderstood the risks that he was taking by investing all his wealth into one particular asset and got badly burnt for his naivety. But at least he got 30 years of dividend payouts on the shares he owned.
It was clearly not a good outcome for him but the best alternative surely can't be to pick a different, even more volatile single asset that produces no income and stick all your eggs into that basket instead.
I wouldn't say he was naive or misunderstood the risks by investing in RBS. He runs his business and had his mortgage and other financial bits and bobs with them. The shares thing was something he was offered 30 odd years ago for using RBS for all his banking needs.
I'm not sure exactly but I guess he was offered shares at a discount for putting a monthly amount into RBS?
Who wouldn't trust RBS back then? Easy to criticise with hindsight.0 -
You see these paperbugs not only wouldn't put their money in PM, they also don't want you tu put your own money where you want to. It's as if they had a vested interest in nobody putting a spanner in the works.
In the event of a bank run or bail in or currency collapse you can always barter that gold with other currencies, goods or services. You might not appreciate its value as an investment, but you can't deny its worth as a hedge against a SHTF moment.0 -
I wouldn't say he was naive or misunderstood the risks by investing in RBS. He runs his business and had his mortgage and other financial bits and bobs with them. The shares thing was something he was offered 30 odd years ago for using RBS for all his banking needs.
I'm not sure exactly but I guess he was offered shares at a discount for putting a monthly amount into RBS?
Who wouldn't trust RBS back then? Easy to criticise with hindsight.
It's easy to criticise larger amounts invested in single shares, it's extremely high risk as we've found out. Obviously banks and other institutions but bp with macondo etc
Of course if this was part of a wider portfolio then that single loss would be balanced by gains elsewhere and overall would have performed well, unlike precious metals unless you were extremely lucky in your timing.0 -
I have a friend who spent 30 odd years putting hard earned cash into RBS only to see it smashed from around £13 a share to something like 26p per share...I wouldn't say he was naive or misunderstood the risks by investing in RBS. He runs his business and had his mortgage and other financial bits and bobs with them. The shares thing was something he was offered 30 odd years ago for using RBS for all his banking needs.
Your first message implies that your friend was ploughing money solely into RBS over a 30-year timeframe. That would still be naive and demonstrate a misunderstaning of risk, even if the consensus was that RBS was rock solid. It should be fairly obvious that single companies can fail, so you should spread your risk over multiple companies. Spreading over multiple markets and asset classes further helps to minimise that risk.
Your second message implies he acquired the shares 30 years ago and sat on them. When owning the shares, he should've been asking himself "if I had the money instead of these shares, would I buy RBS?". If not he should've sold them. Inertia isn't a good reason to have an investment.
Likewise, your very high allocation to precious metals is in need of diversification. Somewhere between 5% and 10% of a portfolio would be more "the norm". Even the PM heavy permanent portfolio only goes to 25%.0 -
You see these paperbugs not only wouldn't put their money in PM, they also don't want you tu put your own money where you want to. It's as if they had a vested interest in nobody putting a spanner in the works.
Don't let emotion drive your investments. I've put some of my money in PM and only realised after I was doing it out of fear. As you appear to, I once bought into the conspiracy theories that people didn't want me to buy the PMs, the true value was being manipulated, JP Morgan are the spawn of the devil, all fiat currencies go to zero, QE, the fed, Nixon and the gold standard, German repatriation of gold, gold always steps in to replace a failed fiat currency, etc, blah blah.
By all means use physical PMs as a hedge against financial meltdown. It might allow you to get a loaf of bread, but do it in moderation. Don't stick too much of your hard earned money into pieces of metal which don't go to work for you.
At least when you invest in companies via shares (or preferably via low cost funds), those companies employ people with a view to making a profit. This is a useful societal contribution which is tangible.0 -
I completely understand everyone is different. What seemed bizarre were your stated reason for moving into metals. If your rate was too low in an ISA then why move to something that pays no income?
There is a risk with investment but it's stupid to just invest in one share and then base their view on investment on that experience. If you'd put money into a tracker for the last 5 or 10 years you'd be sitting on a tidy profit.
I'm not a trader or have a portfolio, I opened a Virgin ISA when they took over Northern Rock because the interest rate was pretty good so I gave it a go. It then dropped each year so I took it out and invested it in physical silver and a little gold. I have other savings and assets. Buying/collecting silver is just a bit of fun and they will hit new highs some day.
I don't care when that is, I'm not doing it for an income, it's actually great fun believe it or not!
SLV and GLD ETF's are a nonsense for the folk that keep suggesting it. Hundreds of paper claims per oz of available physical metal! If you can't hold it you don't own it. You could wake up on a Monday morning and have nothing through no fault of your own. Well, it would be your fault for buying them in the first place!0 -
You see these paperbugs not only wouldn't put their money in PM, they also don't want you tu put your own money where you want to. It's as if they had a vested interest in nobody putting a spanner in the works.
What is the current spot price on tinfoil?In the event of a bank run or bail in or currency collapse you can always barter that gold with other currencies, goods or services. You might not appreciate its value as an investment, but you can't deny its worth as a hedge against a SHTF moment.
Perhaps in the incredibly unlikely event that the currency system as we know it collapses those with significant gold will be rich (assuming it's not taken from you by force in this probably very scary time), or perhaps people won't actually want to trade for your pretty but with very limited use gold and something else will be much more use for trading just because it was currency in the past doesn't mean it would be again should the world fall to pieces.
Nothing wrong with having a few percent in gold but putting everything in precious metals because there is a minute chance it will make you rich is foolish. You'd be better placed being a doomsday prepper or buying a farm.0 -
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Really? The providers of physical ETFs appear to claim otherwise.SLV and GLD ETF's are a nonsense for the folk that keep suggesting it. Hundreds of paper claims per oz of available physical metal! If you can't hold it you don't own it.
The same could be said of those buying physical gold that is subsequently stolen. You could argue you would have the insurance to fall back on (if you have the gold insured), but in the former case you could argue that there is FSCS protection to fall back on if the ETF provider claimed to possess assets that turned out to be missing.You could wake up on a Monday morning and have nothing through no fault of your own. Well, it would be your fault for buying them in the first place!0
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