Gold

[hobo-jo]

Ok you win turk. Clearly any leveraged property investor will always do better than someone in precious metals, because we have ascertained:

• Property investors always buy bottoms & sell tops (no property investors bought the 2010 peak in Melbourne, they all bought earlier or in 2012/13).
• And if they don't sell tops they can always just hold until the next top.
• But actually there's never any selling costs because property investors never sell.
• Only the cherry picked time frame that makes property appear better will be used.
• Property investors always have another property to draw equity from.
• Any costs drawn against another property don't count.
• Leveraged property is never a risk because 100% of their jobs are secure.
• Interest rates will never be a factor because we will do the calculations on variable, but if rates rise they were on fixed.
• If precious metals ever get the edge we'll just throw in tax depreciation because it can be claimed on any property used in a random scenario.
• No diversification of assets is required when you buy property because it performs better than everything.
• All property investors know how to use quote tags on Somersoft (ok well maybe you will get there one day turk, good luck).

Got it.

 

[turk]

Ok you win turk. Clearly any leveraged property investor will always do better than someone in precious metals, because we have ascertained:

• Property investors always buy bottoms & sell tops (no property investors bought the 2010 peak in Melbourne, they all bought earlier or in 2012/13).
  
  I've never claimed this
• And if they don't sell tops they can always just hold until the next top.
  
  As above
• But actually there's never any selling costs because property investors never sell.
  
  As above
• Only the cherry picked time frame that makes property appear better will be used.
  
  Compared the same time frame for options and property.
• Property investors always have another property to draw equity from.
  
  Never claimed this.
• Any costs drawn against another property don't count.
  
  As above
• Leveraged property is never a risk because 100% of their jobs are secure.
  
  As above
• Interest rates will never be a factor because we will do the calculations on variable, but if rates rise they were on fixed.
  
  As above
• If precious metals ever get the edge we'll just throw in tax depreciation because it can be claimed on any property used in a random scenario.
  
  As above
• No diversification of assets is required when you buy property because it performs better than everything.
  
  As above
• All property investors know how to use quote tags on Somersoft (ok well maybe you will get there one day turk, good luck).
  
  Whether I use quote tags or not has no impact on my investment returns. Perhaps it affects your returns.

Got it.[/QUOTE

This thread has been about Gold and Shares, I followed your suggestion and tracked your silver options and superannuation gold shares, I then benchmarked their performance to the ASX and Gold prices over the same period.

All on topic and no mention of property.

You, for some reason in your next post changed the topic and brought up property investing and asked me if I would agree with you that leveraged property is also not for Ma and Pa investors.

 

[Intrinsic_Value]

No Hobo,
some of your logic is correct, unfortunately, you have failed to adhere to the no. 1 rule in trading:
The market can remain illogical longer than you can remain solvent.

That is why intrinsic value is an investor and not a trader.

Far too many traders try to impose fundamental views on trading positions.

Where as an intelligent investor gets paid for his time, and how does he get paid, either through adequate dividends or adequate interest payments.

That is why I will always be an investor and not a trader.
If I am wrong in the short term, as long as I am being compensated through an adequate income stream I am quite happy to be wrong on the 'market pricing' of the asset.

 

[hobo-jo]

No Hobo, some of your logic is correct, unfortunately, you have failed to adhere to the no. 1 rule in trading: The market can remain illogical longer than you can remain solvent.

I'm not sure what logic you are referring to IV, but I would be more concerned about the solvency of those property investors leveraged 10 or 20 to 1 with no or few other investments, rather than my positions in SLV options or mining shares which are only a portion of my portfolio.

 

[Intrinsic_Value]

I'm not sure what logic you are referring to IV, but I would be more concerned about the solvency of those property investors leveraged 10 or 20 to 1 with no or few other investments, rather than my positions in SLV options or mining shares which are only a portion of my portfolio.

I was referring to the fact that a lot of your thought process relates to the Austrian school of financial/economic thought.

In my humble opinion, a lot of this is correct.

However just because it is potentially correct, this doesn't mean that it is the right time to apply it in its pure form, especially from a trading perspective.

Hence the market can remain irrational longer than one can remain solvent.

If adopting trading positions, one must think like a trader and not like an investor.

And a trader always protects his marginal capital (or incremental capital).

This means not digging ones head in when the trend goes against him. If the trend moves significantly and especially on high volume, then the intelligent trader moves to the sidelines at a minimum significantly reduces positions, waits and watches for the right point to enter.

The other na?ve trader, thinks like a trader but acts like an investor.


The converse of this is the na?ve investor.
The na?ve investor 'invests for the long term', saying that over the long term things always go up, stockmarket, property etc.

The intelligent investor looks at intrinsic values relative to market values. Where those market values are significantly higher than intrinsic value, then the intelligent investor also starts to reduce positions.

The other na?ve investor, thinks like an investor, but especially when the going gets tough, acts like a trader.

That is why the 'twine shall never meet' for an investor and a trader.

 

[Deltaberry]

[*]Property investors always have another property to draw equity from.

Well that's only true when you buy 4 properties in one year and each of them makes 30-50% capital growth in 3 months (ie before settlement).

 

[Intrinsic_Value]

Well that's only true when you buy 4 properties in one year and each of them makes 30-50% capital growth in 3 months (ie before settlement).

Delataberry don't be cocky he wasn't referring to sophisticated investors such as yourself.

 

[redwing]

The folks at Visual Capitalist have produced an illustration showing why the precious metal is so, well, precious.

The image above shows how much gold is produced in year, providing a visualization of how that volume of gold would look on a street corner in Paris.

They have a whole slideshow with similar visualizations of commodities from oil to plutonium. You can see it on their site here.

 

[Intrinsic_Value]

and compare that to how much fiat money is produced by the central banks every year. !!!!!!!!

But the fact remains that that fiat money is the medium of exchange, not gold.
This is something the precious metal group can never get their head around.

Until the medium of exchange moves onto a new form of exchange, that fiat money has a 'value' because of its ready exchangability.

 

[hobo-jo]

and compare that to how much fiat money is produced by the central banks every year. !!!!!!!!

But the fact remains that that fiat money is the medium of exchange, not gold.
This is something the precious metal group can never get their head around.

Until the medium of exchange moves onto a new form of exchange, that fiat money has a 'value' because of its ready exchangability.

I doubt fiat currencies are going anywhere. It's unlikely we go back to a fixed Gold standard (and I don't think we should, it's been tried and failed), but having substantial Gold reserves can still support the value of a fiat currency. See the latest from Greenspan: http://www.foreignaffairs.com/articles/142114/alan-greenspan/golden-rule

 

[WASP]

Therefor if an asset price is dropping, then it can make sense for the small investor to exit the position, wait on the sidelines, and then get back in at a lower price.

However this is very time consuming, it involves sitting in front of the computer screen, watching live pricing, watching the movements of trades, and getting a feel for the strength of buy/sell trades.

Is the ATO okay with this or do they see it as a "wash" sale?

 

[redwing]

Re: Gold

I read a piece recently that said gold is heading to $1,025.00

There are 2 obvious reasons for the falling price, beyond the fact that there are simply more sellers than buyers.

• The first reason is the rising U.S. dollar.
• The second reason is deflation.

 

[pieman]

Surely hj you're still not into that brightly colored stuff. Forget it mate. Stick to PI or shares. Bhp now is a 4.8% yielder - great long term stock, surely this beats the 0% yield AND capital loss?
Money's to hard to earn mate.

 

[hobo-jo]

Re: Gold
I read a piece recently that said gold is heading to $1,025.00

Both believable reasons for short term weakness in Gold price, but same reasons would be likely to impact AUD e.g. local price may not be negatively affected by a drop to US$1025.

Surely hj you're still not into that brightly colored stuff. Forget it mate. Stick to PI or shares. Bhp now is a 4.8% yielder - great long term stock, surely this beats the 0% yield AND capital loss?
Money's to hard to earn mate.

Mate, you're on a property forum where investors are prepared to pay hundreds of dollars each week to hold an asset hoping for capital gains (i.e. negatively geared) and you think I'm worried about an asset which costs me next to nothing to hold?

 

[MIW]

As I often say, there's time and place for every asset class to be overvalued, undervalued or on par so I do not understand why people think one is better than the other, unless they have a crystal ball, right?
Picking the throughs or bottoms is the tricky thing.
It's surprising when egos grow....

 

[hobo-jo]

As I often say, there's time and place for every asset class to be overvalued, undervalued or on par so I do not understand why people think one is better than the other

Too true. I'm not sure why some find owning precious metals is so offensive, but I will be back into property in the near future, doesn't mean I will be selling all my metals as it's actually possible to hold more than 1 asset class at the same time

 

[Aaron Sice]

as it's actually possible to hold more than 1 asset class at the same time

SSSSHHHHHHH

 

[pieman]

Too true. I'm not sure why some find owning precious metals is so offensive, but I will be back into property in the near future, doesn't mean I will be selling all my metals as it's actually possible to hold more than 1 asset class at the same time

Around how much have you invested in your precious metals?

 

[hobo-jo]

Enough pieman