Hi Sir Auric Goldfinger,
I agree with you that gold is currently very attractively priced relative to cost. I hold gold bullion coins (Koalas, Maples, Eagles, Pandas, and some really beautiful mint sets from many countries) in quantity. I hold much more platinum coins (Koalas, Pandas, hitting a new high today) and a lot less of palladium coins (Pandas broke $1000/oz today). Together these coins take up a good portion of the bottom-shelf largest sized safe deposit box, as I like to take possession, catch sight of the shine, and fondle the round shapes through the plastic shell, every so often. I would not like to be carrying the stuff while on a sinking ship. You think you like gold?
I buy these coins at regular intervals (average cost of Pt is around US$ 418/oz, Au at around $288/oz), mostly when I take a significant trip, lost a lot of money, spent a lot of money, wanting to spend a lot of money, or made a lot of money. I buy the coins without any intention to sell. I treat the stash as an anchor, a sort of Chen clan monetary reserve kept safe against most government fiat and proletariat uprising. One of my offspring will be extremely happy one day, deservedly or not.
I am fully cognizant of the many problems with gold: there is quite a bit of it about in central bank vaults, in the ground, and it has no particular use other than decoration and hoarding. The plus point is it has a 4000 years monetary history, fungible and liquid. The masses, at panic times, may yet again vent their mania to gold, as it would be easy, and certainly much easier than getting hold of the really valuable stuff, platinum. I am now forced to add platinum at a much slower pace than gold as the HK banks no longer keep their platinum sales windows open and only buys. So, I explore and bargain in coin shops, hang out at Ebay, and default to gold purchases, as the premium in coin shop and Ebay make no sense for a hoarder already weighed down with the white stuff.
Over the past three years, for modern investment, as opposed to barbaric hoarding, I trade NEM, SWC shares and options. Lately I have been buying AU, IMPAY, and AAPTY as well. I find NEM option trades able to finance a good portion of my gold hoarding. I now have massive January Call 40 shorted mid June at price of $ 2.10/share equivalent and massive January Put 12.5 shorted late October at price of $0.89/shr equivalent, and have January SWC Put 25 shorted at $ 3.57/shr. It looks like all short positions will expire worthless, enabling more hoarding. The AU, IMPAY, AAPTY all pay a healthy dividend rate, a novelty these days. I know I am now boasting and bragging, but I cannot help it, for I am pleased. It does not concern me if I have to wait 30 years to see the gold mania return as long as I can make money off gold in the dreary interim.
My trades in the options follow some rules: never buy options, only short puts and covered calls, always hold to expiration (adjust risk profile via sale of underlying shares), and mostly at times when the underlying shares are priced at either extreme of 52 week price range, and always in amounts that matter. Chugs |
