Gold GBP

Adyinvestment

I found the below interesting, which looks like holding gold in GBP has been more profitable than USD - also we are the best performing out of all the currencies, which I assume means that GBP has lost the most against USD

Also not a bad annual average return over the last 15 years, significantly more than the "inflation protection" that some perceive it.

masonic

The performance of gold looks best in GBP because GBP is being devalued faster than the other world currencies, which is not a good thing if you live in the UK. Of those in the table, only Japan has done worse this year. Imagine how "good" it would look if held in Roubles! This is an advert not to have investments tied to the value of the pound.

aroominyork

How low can it go? Anyone thinking of moving their global trackers into hedged versions? Personally, I see little reason Sterling will recover much. (Insert your own rant about Brexit here.)

InvesterJones

aroominyork said:

How low can it go? Anyone thinking of moving their global trackers into hedged versions? Personally, I see little reason Sterling will recover much. (Insert your own rant about Brexit here.)

I'd only move into hedged versions if I thought the pound was going to strengthen significantly vs the native currency. And with the current gov't I don't, so I won't

masonic

aroominyork said:

How low can it go? Anyone thinking of moving their global trackers into hedged versions? Personally, I see little reason Sterling will recover much. (Insert your own rant about Brexit here.)

It looks like there's plenty of pain yet to come.

Adyinvestment

masonic said:

This is an advert not to have investments tied to the value of the pound.

This is one of the reasons I was looking at adding more gold today, the problem for me is that gold does not look good value in GBP to me at the moment.

Prism

aroominyork said:

How low can it go? Anyone thinking of moving their global trackers into hedged versions? Personally, I see little reason Sterling will recover much. (Insert your own rant about Brexit here.)

I only hedge things that I want for stability and lower volatility, not based on which way I think GBP might move (since I have no idea). That means pretty much just global bonds for me.

InvesterJones

It's one of the annoying things about terminology isn't it? We tend to assume hedged means more stable/lower volatility, but when we're talking about currency hedged, it's nothing of the sort - that 'hedges' against the native currency falling, sure, but instead prevents you from hedging against the non-native currency falling, when buying the native fund might actually provide you with more of a hedge to your other assets/costs.

Prism

InvesterJones said:

It's one of the annoying things about terminology isn't it? We tend to assume hedged means more stable/lower volatility, but when we're talking about currency hedged, it's nothing of the sort - that 'hedges' against the native currency falling, sure, but instead prevents you from hedging against the non-native currency falling, when buying the native fund might actually provide you with more of a hedge to your other assets/costs.

I'm not sure I follow you, but hedged funds typically hedge in both directions. If the native currency moves in relation to the currencies of the holdings then it has no effect. In the case of bond funds that typically reduces volatility.

masonic

Adyinvestment said:

masonic said:

This is an advert not to have investments tied to the value of the pound.

This is one of the reasons I was looking at adding more gold today, the problem for me is that gold does not look good value in GBP to me at the moment.

It's not good value, looking at its current spending power vs inflation adjusted historic average, looking over 50 years, worse if you include 100 years of data. How it fares over the coming months will depend on how the current economic themes play out, and whether the reality will be worse than what is currently expected.

Altior

If you're buying USD gold, you're betting on the PM and the currency.

If you want to bet on the currency, buy dollars. And instead of a fee for holding, you'll get paid interest for owning it.

Hedged gold means that you're negating the currency gamble, it's a pure gold play. Which is the idea of buying and holding gold, I'd have thought.