Invest in gold or something else ?

Clare43

Hello,

I have an 8k fixed term saver maturing in April and am deciding how to re invest / save the money. I've thought about maybe investing some in gold but am not sure if it's worth it / where to start really. I have a variety of other investments / savings accounts ( mentioned more in a different thread of mine a couple of days ago ) and don't know if I should just put the 8k into those or something else ?

ColdIron

I am keen on gold but I don't kid myself that it's an investment, it's more akin to speculation. It produces no income or anything else, all it can do is change price and is as likely to go down as up
http://www.kitco.com/charts/popup/au3650nyb.html

It is a decent store of wealth (not value) and a good hedge against high inflation or currency collapse, I.e. a fear asset. It can be useful as a diversifier but only as an addition to an already well diversified portfolio, perhaps 5% to 10%

If you want to buy gold look at bullion coins, Sovereigns, Krugerrands, Britannias etc. UK coins have some tax benefits (CGT) that may be useful if you have a substantial amount

On balance in your circumstances I would say no

fabsaver

Can you afford to lose a large chunk if the price goes down? I have a gold fund as a very small part (less than 1%) of my portfolio. The volatility of that fund is scary :eek:

Clare43

Thank you both. Any thoughts on what would be best plan for the money ?

ColdIron

You have had several suggestions in your other thread, Advice about maturing fixed rate saver, I'm not sure having 2 concurrent threads would help

jimjames

Clare43 wrote: »

Thank you both. Any thoughts on what would be best plan for the money ?

If you're prepared for the risk of something like gold why are you not looking at S&S inside an ISA instead? Or do you already have an ISA?

Linton

You need to look at your investments as a whole. One cant have a sensible view as to whether gold is a good idea or not unless one can see how it fits in with everything else.

In your other post you say you have £33K in a range of equity funds. Investing 20% in gold seems a very high % given its volatility and the lack of any dividends/interest from it. Also from your other post it would seem you are holding something like 15 funds (if this is incorrect please lert us know hhow it is invested). This seems pointless as each would on average only be about £2K and so in the overall scheme of things contributing very little.

My conclusion is that you should simply include the £8K in a reassessment of your whole portfolio, compressing it into a maximum of perhaps 4 or 5 funds that jointly give provide a very broad diversification.

I also note that you are considering whether to invest or save the money. That decision is easy: if you have enough accessible cash savings to cover an emergency fund of perhaps 6 months living expenses and any major expenses you expect to make in the next 5 years or so any extra money can be invested for the long term.

Clare43

ColdIron wrote: »

You have had several suggestions in your other thread, Advice about maturing fixed rate saver, I'm not sure having 2 concurrent threads would help

I started this one mainly asking for opinions on gold. The other thread was more general.

Clare43

jimjames wrote: »

If you're prepared for the risk of something like gold why are you not looking at S&S inside an ISA instead? Or do you already have an ISA?

I have some S&S with L&G investment funds but I don't have an ISA at present

atush

Gold- it produces no income. It can go up or down- but buying when prices ree high like now is not attractive.

Is this your only 8K? Do you have an easy access cash emergency fund? Do you have a pension? Do you fill your S&S isa allowance?

I would do one or all of the 3 above before investing in gold.

PS, I do invest in gold. But it a tiny percentage of all assets, and I bought it when prices were VERY low as a diversification move. Since I bought, i sold half at around $1400/oz

Clare43

atush wrote: »

Gold- it produces no income. It can go up or down- but buying when prices ree high like now is not attractive.

Is this your only 8K? Do you have an easy access cash emergency fund? Do you have a pension? Do you fill your S&S isa allowance?

I would do one or all of the 3 above before investing in gold.

PS, I do invest in gold. But it a tiny percentage of all assets, and I bought it when prices were VERY low as a diversification move. Since I bought, i sold half at around $1400/oz

Thank you. It's just a maturing account. I can access some money if need to in an emergency. I have a work ( NHS ) pension and 3 different policies I've set up a lot of tears ago. I've never had a S&S isa - have the S&S in the investment trust I have with L&G but have never done an isa. Up until now I've just done savings accounts etc, and the L&G is my first venture into S&S that I've been doing for about 8 months