The continuing drop in gold bullion makes for an interesting discussion on how much gold an investor should hold. There is an old belief that everyone should have some gold in their portfolio. I hope through this article I can show you why I believe simply holding gold is a mistake without a plan to benefit from trading any gold investment.
Recently an investor wrote to me wondering how much gold he should hold in his portfolio. We corresponded several times so I could get a better understanding of this investor’s needs. The investor is retired in the United States, has investments of at least 1 million US dollars through IRA’s (wife and personal) and is doing naked puts and put credit spreads.
Here is his (edited) question on how much gold should an investor hold:
I am interested in what your thoughts are on having some gold and the like in my investment mix. I am retired with no debt and about $1 million in various investments . I utilize many of your strategies and believe your perspective on investing. Thanks for everything!
Investing In Gold:
The problem for a lot of investors is that there is a long-term belief or tradition that a certain percentage of a portfolio should be in gold. The reasoning is that events can change including socio-economic events which can have severe impacts on portfolios. Gold can assist at times in protecting those assets.
This strategy article is 10 pages in length with 3800 words. It is a lengthy strategy article looking at investing in gold through such products as the GLD ETF. A variety of strategies are presented from Put Selling to synthetic option positions to collars. Included is a detailed look at the Shark Option Trading Strategy and the 10-20-30 Moving Averages Strategy. This is a FullyInformed Members strategy article. Members can login directly through this link to read the rest of this article or Members can sign in to the full members site here. Non-members can join here.