Best way to buy gold?

HansOndabush

ColdIron said:

HansOndabush said:

Prism said:

Why do you want to buy gold? If you can work out your reason and it seems sensible the next step is to work out if you think many people agree with you. If they do then gold will likely go up, if not it will likely go down. 

You buy gold because it is a store of value proven over thousands of years. Fiat currencies come and go but you can rely on gold to maintain purchasing power. What you propose would only apply to a short-term speculator.

Gold is a good store of wealth, it is unlikely to become worthless, but it's a rotten store of value

Really???

BananaRepublic

HansOndabush said:

ColdIron said:

HansOndabush said:

Prism said:

Why do you want to buy gold? If you can work out your reason and it seems sensible the next step is to work out if you think many people agree with you. If they do then gold will likely go up, if not it will likely go down. 

You buy gold because it is a store of value proven over thousands of years. Fiat currencies come and go but you can rely on gold to maintain purchasing power. What you propose would only apply to a short-term speculator.

Gold is a good store of wealth, it is unlikely to become worthless, but it's a rotten store of value

Really???

https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart

[Deleted User]

HansOndabush said:

Prism said:

Why do you want to buy gold? If you can work out your reason and it seems sensible the next step is to work out if you think many people agree with you. If they do then gold will likely go up, if not it will likely go down. 

You buy gold because it is a store of value proven over thousands of years. Fiat currencies come and go but you can rely on gold to maintain purchasing power. What you propose would only apply to a short-term speculator.

Gold comes and goes and is worth what people are willing to pay for it. If the world tomorrow decided gold was worthless, your money would be gone.

I'd up that 100 year chart with a near 200 year one where gold has peaks and troughs. It's a downward trend at the moment but could go up or down - someone buying gold in September 2011 at £1178.92 would have lost spending power value as it started dropping then, pretty much until July 2019 when it passed the value again. Someone buying in December 2015 at £712.03 could have doubled their money selling in September 2020 at £1478.47

HansOndabush

It's no good looking at gold in fiat currency numbers. All fiat currency has drastically lost value compared to gold since 1971 when we came off the gold standard. For thousands of years an ounce of gold has been able to buy you a good suit and it still can. The same cannot be said for a unit of fiat currency.

AlanP_2

HansOndabush said:

It's no good looking at gold in fiat currency numbers. All fiat currency has drastically lost value compared to gold since 1971 when we came off the gold standard. For thousands of years an ounce of gold has been able to buy you a good suit and it still can. The same cannot be said for a unit of fiat currency.

You can make a case for fiat currencies losing value maybe but not sure your suit analogy stands up to much examination.

Taking prices at start / high / low / end points from the macrotrends link above, but reset to 30 years, you get:

Jan 1991 - $700 per oz
April 2001 - $383
Aug 2011 - $2100
Dec 2015 - $1177
Jan 2021 - $1846


Looks fairly random to me and has no relationship with what suits, or anything else, cost in the real world.

An ounce of gold can buy you a new suit at any time in that period, its just that at some points you would get no change, and at others you would get 50/60/70% back.

DiggerUK

Type_45, you ask what is the future for gold, and how you should buy in to gold.

My judgement is that a fully funded boom is in the pipeline. Our government didn't come to power planning a continuation of austerity, their first act of significance was to whack up minimum wage and steal labours money tree. If you remember the infrastructure spending plans for HS2 and the likes were eye watering.

Then covid came along.

Somehow they have to shovel the boosterism around to overcome what was already a lame duck economy and prevent a meltdown. I believe the money spigots are going to be turned wide open and I don't just refer here to QE.  My supporting evidence as argument is that the masters of the universe are consistent in their promise to "do what it takes".

In my opinion, that means the markets will need to be sugar rushed in a manner that surpasses all that has come before. Gold prices in that scenario should trend down, so I don't see the need to be in a rush to buy for now, especially as we have had over six months of lower lows, and lower highs with gold prices.

How you hold any gold is what you feel secure with. I would say physical with UK legal tender or gold backed ETF's ETC's are the wise choices..._ 

HansOndabush

DiggerUK said:

In my opinion, that means the markets will need to be sugar rushed in a manner that surpasses all that has come before. Gold prices in that scenario should trend down, so I don't see the need to be in a rush to buy for now, especially as we have had over six months of lower lows, and lower highs with gold prices.

How do you work that one out? A load of currency creation is bullish for the gold price in that currency.

As an aside, I bet you wish you had some silver, it continues to outperform gold.

BananaRepublic

HansOndabush said:

It's no good looking at gold in fiat currency numbers. All fiat currency has drastically lost value compared to gold since 1971 when we came off the gold standard. For thousands of years an ounce of gold has been able to buy you a good suit and it still can. The same cannot be said for a unit of fiat currency.

Gold is so volatile that I wouldn't touch it with a barge pole. There is a reason that investment funds do not hold gold.

HansOndabush

BananaRepublic said:

HansOndabush said:

It's no good looking at gold in fiat currency numbers. All fiat currency has drastically lost value compared to gold since 1971 when we came off the gold standard. For thousands of years an ounce of gold has been able to buy you a good suit and it still can. The same cannot be said for a unit of fiat currency.

Gold is so volatile that I wouldn't touch it with a barge pole. There is a reason that investment funds do not hold gold.

That's rubbish. Investment funds hold what their remit and aims allows them to. A precious metals fund WILL hold gold. A bio-tech fund will not hold gold.

More generally studies have shown that a 5-10% portfolio allocation to gold improves portfolio returns.

DiggerUK

AlanP_2 said:

Jan 1991 - $700    $384

April 2001 - $383   $265
Aug 2011 - $2100  $1358
Dec 2015 - $1177  $1250
Jan 2021 - $1846   $1868 

 0/5 I'm afraid, not your best day at homeschooling is it. 🤫

The monthly averages from the horses mouth are equally random, albeit reliable..._
http://www.lbma.org.uk/precious-metal-prices#/table