I took the model portfolio to 10% leveraged positions on June 16 in gold and silver. They paid off this week. We will sell on the next big up day and put the money back into unleveraged positions and very battered very cheap post Brexit European bankster banks.
NUGT, the 3x leveraged gold miners fund, is up 31.5% since we bought it.
USLV, the 3x leveraged silver fund, is up 40%.
These funds are dangerous and shouldn’t be held for too long.
Disclosure for legal purposes: I own NUGT and USLV. And I am not recommending anyone do anything since the government says I am not a financial adviser.
As for gold, it has, for the first time since crashing in April 2013, broken through the 200 week moving average, and inflation isn’t even high yet. When inflation exceeds 5%, you will see the metals go up faster than you can imagine. Once inflation becomes obvious, we’ll see a quick trek to $5,000 or more, probably before 2020.
2 thoughts on “Model Portfolio Home Run and Gold Update”
I am intrigued by your investment program and your prognostications. I am much less sophisticated. My wife pays the bills and keeps the bank account, so when I want to make an investment, I need to go to her with my reasons. I haven’t been very successful getting her to agree with me in the last few years because she reminds me that my foray into buying physical silver did not pay off, therefore any advice I have is tainted by the scent of failure.
I’ve watched the run-up in metals and have felt frustrated that I am on the sidelines. When silver was $12, I told my wife it was time to buy. She didn’t believe me. Now that it’s almost $19, she really doesn’t believe it will go higher. I, on the other hand, believe metals are more likely to go up than my 401k. My mantra is “that which can’t go on forever, won’t.”
$5000 gold? Seems reasonable to me, given bank money creation and the increasing likelihood of helicopter money. I’m thinking that $100 silver is more than reasonable, given the amount of paper silver that is reportedly keeping the price down.
I get things wrong plenty. I got gold very wrong, bought it too early but I still think it’s going to $5,000 eventually. I bought gold stocks back in late 2012 and I’m still down. Only now am I starting to really recover nicely. The key is you have to stick with your analysis and deal with the pain if it comes, and make sure your positions are not leveraged to the point where you cannot weather a timing error.