Gyroscopic Investing

Tyler addresses gold as a diversifier in his latest outstanding post:

THREE SECRET INGREDIENTS OF THE MOST EFFICIENT PORTFOLIOS

https://portfoliocharts.com/2021/12/16/ ... ortfolios/

flyingpylon wrote: ↑Sat Dec 18, 2021 6:30 am Tyler addresses gold as a diversifier in his latest outstanding post:

THREE SECRET INGREDIENTS OF THE MOST EFFICIENT PORTFOLIOS

https://portfoliocharts.com/2021/12/16/ ... ortfolios/

Phenomenal!

Another excellent article by Tyler

flyingpylon wrote: ↑Sat Dec 18, 2021 6:30 am Tyler addresses gold as a diversifier in his latest outstanding post:

THREE SECRET INGREDIENTS OF THE MOST EFFICIENT PORTFOLIOS

https://portfoliocharts.com/2021/12/16/ ... ortfolios/

Yeah, thank you for that!

Biggest takeaway for the discussion that happens here with mj and budd:

1) An asset is a critical component in many of the most desirable portfolios.
2) The same asset is disastrously undesirable when studied only in isolation.

A fantastic article, Tyler. Thank you!

Cortopassi wrote: ↑Sat Dec 18, 2021 9:52 am Biggest takeaway for the discussion that happens here with mj and budd:

1) An asset is a critical component in many of the most desirable portfolios.
2) The same asset is disastrously undesirable when studied only in isolation.

Except I don’t look at it in isolation ..I look at some assets as a dead weight on the most common horse , equities in some environments..there are times being overly interest rate sensitive is not a great idea ….you don’t have to be heavy equities but you don’t need to bet the ranch on rates either.

I have an allocation to equites in between the pp and the butterfly , however the pp is weighted for lower rates and lower inflation , i am weighted for higher inflation and rates going higher

Thanks, everyone!

Yeah, the section on gold is an important one for anyone considering adding some to their own portfolio. Occupying the very best portfolios while also being the single worst investing option by itself presents a unique challenge for investors who like to track their portfolios closely. If you don't have the right mindset, it will drive you crazy even when it's doing its job just fine.

As I said in the article, know thyself.

Fantastic article, thanks Tyler

In the UK both stock and gold have tracked inflation in a very volatile manner. House prices more closely so. 50/50 stock/gold considerably reduced the volatility to be more house like


PV data since 1994 comparing REIT with 50/50 TSM/gold

Increasing real rates hurt gold, stock, and LTTs. Real rates can only go so low...unless they ban cash

boglerdude wrote: ↑Sat Dec 18, 2021 9:42 pm Increasing real rates hurt gold, stock, and LTTs. Real rates can only go so low...unless they ban cash

Adding to the UK charts I posted above ... compare 'real' stock/gold 50/50 relative to a 'inflation' rate of house prices and ...

it would require a +40% house prices increase coinciding with a -40% 50/50 stock/gold decline to see the progression baseline to 1.0. That's unlikely to occur over a single year, might take 7 years or 11 years ... whatever - but is something that could occur.

What might drive that? Well high inflation, rising wages, rising positive real yields, which as you say would likely hit stocks/bonds/gold. What are the prospects of such rising/high inflation and wages? Well they already seem to be flowing through the pipeline, largely a consequence of excessive QE/printing. Real rates can turn sharply positive pretty quickly, just takes a sharp decline in inflation after rates had already been raised to modest/high levels.

As ever all-a-guess, and a Clubber Lang 'pain' prediction, but one that could see houses and cash (short dated treasuries that roll into higher yields) doing better than stocks/bonds/gold.

Vanguard study showing the correlative relationship between inflation and various assets. Note that gold is only outdone by TIPS. Of course, gold has the volatility we're looking for though.

Read this book on 12/15/80. Should I be re-reading it??!!!

How you can profit from gold Hardcover – January 1, 1980
by James E Sinclair

https://www.amazon.com/How-you-can-prof ... l_huc_item

ahem

dualstow wrote: ↑Fri Feb 11, 2022 2:25 pmahem

exactly

Sbsw for some juice

Boo Yah. Does anyone know what happened at 1:30 Eastern? They all just took off.

A mention of a potential attack from Russia in Ukraine and for US citizens to leave the region.

buddtholomew wrote: ↑Fri Feb 11, 2022 3:42 pm A mention of a potential attack from Russia in Ukraine and for US citizens to leave the region.

Should we sell before Putin backs off. J/K, i’m all in.

If you can stand the volatility...

In my opinion, this is an optimal time to sell gold and buy your favorite precious metal mining companies with the proceeds.

Or better yet, sell 50% of s&p and go into precious metal miners with the proceeds

murphy_p_t wrote: ↑Fri Feb 11, 2022 6:38 pm Or better yet, sell 50% of s&p and go into precious metal miners with the proceeds

Unless it's a retirement account, the tax repercussions of a move like this are huge. I don't invest this way.

Apmex has had some great deals and I have not pulled the trigger. I'm kicking myself a bit on the price move today.

Why are chinese gold ingots shaped the way they are? (See avatar.)

Smith1776 wrote: ↑Sat Feb 12, 2022 3:28 pm Why are chinese gold ingots shaped the way they are? (See avatar.)

Well my young friend, I think it was just for aesthetic reasons. From the intro to ‘Empire of Silver’ (hat tip to Kriegs), pp3-4:

Generally speaking, from the Han to the Ming dynasty, silver sycee gradually developed from a round cake form into an elongated forum, and then contracted in the middle for the yuanbao form. In numismatic terms, this development made the currency more attractive, but in practical use it was an inconvenient and a retrograde step.

Maybe they just loved cakes

More here- https://en.wikipedia.org/wiki/Sycee