Bad time to start a sovereign stack?

[walesdave]

Hi All,

I sold my sovereign stack about 3 months ago and am now thinking about starting up again.

Problem is, my wife and I can't save cash....buying 5 to 10 sovereigns a month was no problem but since July we've not only not saved but managed to spend (a little) of our savings .

So, the wife has finally admitted that sovereigns might be the best way to save even in the short term and accepting we might make a bit of a loss but at least save something.

The question is (as always ) how is the price going to go int he next 5 or 6 months? Any ideas? I know it's an unfair question, but I've not been following things since July and just want to get a feel for things before giving HGM or Atkinsons a call.....

Cheers

David

[Clens92]

The price has been rather unpredictable since the 23rd of June.

I think there is a case for saying that gold might slide over the coming months - the US Fed might raise interest rates (read: probably will).  Higher interest rates makes gold seem like a less attractive investment, as it doesn't pay interest.

There's also a case for saying that gold might rise.  The German banks are in serious trouble, and there is a real possibility that DeutscheBank needs to be recapitalised.  With Article 50 negotiations expected in early 2017, the pound is likely to take a slide against the dollar - increasing the gold price over here.

 

Is there ever a bad time to start a sovereign stack?  As you say, you're not managing to save at the moment so it does appear to be a decent shout for getting you saving again.

[Stu]

Based on nothing factual or even inflatable like technical analysis ? And for what's it's worth, I think gold will drop a little and then take off even higher. As good as anyone else's guess. 

[Heisenberg]

48 minutes ago, walesdave said:

Hi All,

I sold my sovereign stack about 3 months ago and am now thinking about starting up again.

Problem is, my wife and I can't save cash....buying 5 to 10 sovereigns a month was no problem but since July we've not only not saved but managed to spend (a little) of our savings .

So, the wife has finally admitted that sovereigns might be the best way to save even in the short term and accepting we might make a bit of a loss but at least save something.

The question is (as always ) how is the price going to go int he next 5 or 6 months? Any ideas? I know it's an unfair question, but I've not been following things since July and just want to get a feel for things before giving HGM or Atkinsons a call.....

Cheers

David

Ditto that, sold a lot of mine after Brexit, made a moderate profit, and have been put off buying ever since due to the high(er) price..

 

Not saved anything of note, spent just as much as i did when gathering gold and very little to show for it except a few fancy electrical gadgets i dont really need or use, (treated myself to a mack and used it twice!)

 

For some reason the fevers back,(could be due to me watching the new bearing sea gold episodes), and ive started gathering again, i cant  spend gold and its always there if i need cash in a hurry, so any disposable cash of note is going Atkinsons/HGMs way, instead of Bet365s and women of dubious character.

 

 

[sovereignsteve]

If you're talking "stacking gold" then there's a good chance that anytime soon is a good time to buy, for long term holding. Things can only get worse in the world economy/banking world.

However, if you're talking "collectable sovereigns" then maybe now isn't the best time to start as prices have risen significantly recently.

The gold spot price has traded into a very narrow channel for the last couple of months so there's a good chance of a significant move soon, up or down. Which way do you think it will go?

[KDave]

No one knows if now is a good time or not mate, gold is very volatile in both directions so for short term savings I would say stay away. I remember you were uncomfortable with the volatility last time when you had built up a decent stack so perhaps consider your options before doing the same thing again. 

If you are just looking to save why not start a regular saver with a few different banks instead perhaps? Set up some standing order with a few banks to save £200 a month or whatever, the interest is paid at the end of the term so there is incentive to not touch it until it matures. But at least there is on paper only upside over the short term, you get your interest and don't have to realise a loss if you need the money?

If you are thinking longer term then fair enough investing is the way forward, but again, is it gold you want specifically? Or just somewhere to tie up your money? What about income investments like dividend stocks or peer to peer lending you can make regular contributions to those too you don't need big sums. Gold is good and all, but just getting it on its own will leave you feeling rather exposed to its price movements and the result will be wanting to sell again when volatility picks up I guarantee it. A bit of everything is a good way to counter this, but this is not advice just my thoughts, do as you wish 

[walesdave]

Hi All,

Many thanks for the advice - all read and taken on board!

Clens92 & Stu  - To be honest I just miss the little coins and needed some validation to start buying again.....I'll be on the phone tomorrow for 10 sovs from HGM if they have some at spot +2% still. If £ goes up, it goes up, if it goes down, it goes down....as long as it doesn't completely crash then just saving something is my goal....

Heisenberg - I hear what you're saying in spades! Not gadgets in our case but travel.....14 year old daughter NEEDED (her emphasis!! ) to spend the entire summer in the middle east with family and friends...then 10 year old daughter said if her big sis got to go so should she....followed by wife and middle kid heading off to the Canary Islands. I cr@p you not, I stayed at home and looked after the dogs while watching the ££££s disappearing!! (I bought a few things as well  ). 

sovereignsteve - no interest in collectables, just bullion. Plan is still selling our house, it's been on the market for 3 months with no offers (priced to sell but market is dead at the mo). The more I can save until it sells, the bigger the deposit when we move.

KDave - appriciate the advice, and good it is too, just not for me. Cash just evaporates in our house...wife and I are both adults and are both to blame!

[Sovereign]

Go for it 

Sovereigns as you know easy to buy and sell 

But when u buy try to keep stacking for at least a year I know it's hard but it can be done  

[oliversw5]

Ill throw an alternative idea into the mix. 

Ever thought about 'stacking' (for want of a better word) shares? yes its also volatile but there are some very good yielders atm which you could compound to protect you against potential loss. 

Just an idea for you.

 

[walesdave]

Just ordered 2 Britannias from Atkinson's  .

Thought it would be easier to keep count of the bigger coins.....  ....and I've never seen an oz of gold before!

oliversw5  - thanks for the idea. Not that I have much of a clue about gold, but I'd be dangerously clueless about shares...

Cheers, and I have to say it's nice to be back in the gold collection game but also nice to be back in the forum

- David

 

[SilverTanner]

Congratulations on the Brits, I think 1oz gold is impressive but I am a bit reluctant to buy pure bullion at the moment, the same goes for more shares as the markets seem to be on a high and I've given up trying to pick winners and just use ETFs now (just waiting to see which way they go with the outcome of the US election).

So I have gone back to buying pure numismatic coins and just paid about 200x spot for one! some of the others I bid on went for more than 700x spot - I tell myself they are my current pension contributions?.

ST

[Oldun]

Gold is priced worldwide  in usd first and foremost. The gbp (as all currencies) in relation to the usd determines the price. Brexit changed the realignment of the gbp to the usd resulting in the recent spike plus the increase of the price in usd. If you see those scenarios reversing and are happy to buy in slowly, do so. If you are a gambler, put all your eggs in one buy and enjoy the thrill of wherever it goes, up or down. Or, just put a max of 10% of what you can save in a week or month into pms and just chill out. You will still have the other 90% to worry about in cash for emergencies or to increase in value in a deflationary environment, or stocks, property, baseball cards, old bicycles (!) start up companies, education, whatever investment you feel like etc. Good luck, your choice

[HelpingHands]

@SilverTanner Hopefully we'll see that purchase in the 'today I received' thread.

[sovereignsteve]

11 hours ago, SilverTanner said:

Congratulations on the Brits, I think 1oz gold is impressive but I am a bit reluctant to buy pure bullion at the moment, the same goes for more shares as the markets seem to be on a high and I've given up trying to pick winners and just use ETFs now (just waiting to see which way they go with the outcome of the US election).

So I have gone back to buying pure numismatic coins and just paid about 200x spot for one! some of the others I bid on went for more than 700x spot - I tell myself they are my current pension contributions?.

ST

Intrigued...........

200x spot so not likely to be a gold coin, so, silver.....£14.75/oz spot therefore you've paid £2950/oz. Assuming a crown that's 26g silver so that's almost £2.5k. Sweet, hope it's a nice Gothic Crown

Or if a sixpence, about £250

[SilverTanner]

Not even an English coin this time - just waiting for the invoice. I thought I would diversify a little.

In the past I've paid alot more than £250 for a sixpence! Almost all 6ds young-head Victoria and earlier would be more than £250 in high grade so it isn't difficult ?. Anyone collect VIP proofs???

ST

[Pete]

No-one can predict the future PM spot prices.
Forget trends, algorithms and extrapolations - easy to fit theory to past events.
If guaranteed forecasting was possible we would all be trading paper contracts on huge margin deals.

If you have spare cash to invest why not buy some Lloyds Bank shares as the pundits in the know seem to believe they are cheap at the moment and next year may pay out close to a 6% dividend. There is also risk buying shares, but I am buying over 20 sovs' worth of LLOY first thing tomorrow. Worth a thought at least unless you have fallen in love with metals.

[KDave]

12 minutes ago, Pete said:

No-one can predict the future PM spot prices.
Forget trends, algorithms and extrapolations - easy to fit theory to past events.
If guaranteed forecasting was possible we would all be trading paper contracts on huge margin deals.

If you have spare cash to invest why not buy some Lloyds Bank shares as the pundits in the know seem to believe they are cheap at the moment and next year may pay out close to a 6% dividend. There is also risk buying shares, but I am buying over 20 sovs' worth of LLOY first thing tomorrow. Worth a thought at least unless you have fallen in love with metals.

To be putting 20 sovs worth into a single stock, one sector (no diversification at all, zero) with a promise of a dividend that does not exist except in the minds of the pundits, that appears to be incredibly risk on to me. Mario Draghi himself has all but called for governments to take over in terms of where to go next with monetary policy - last time that meant bank bail outs. 

I have not researched lloyds or the banking sector specifically however, so you could be onto something and now might be the best time to buy. There is certainly a lot of blood on the street for that sector and the noise from the media is almost entirely negative (a good sign). But it is exceptionally ballsy to say the least. I remember last time that when one bank went down, they all went down and it looks like one of the big boys of the banking sector is about to go down hard. You know which one I mean. 

[Pete]

2 minutes ago, KDave said:

To be putting 20 sovs worth into a single stock, one sector (no diversification at all, zero) with a promise of a dividend that does not exist except in the minds of the pundits, that appears to be incredibly risk on to me. Mario Draghi himself has all but called for governments to take over in terms of where to go next with monetary policy - last time that meant bank bail outs. 

I have not researched lloyds or the banking sector specifically however, so you could be onto something and now might be the best time to buy. There is certainly a lot of blood on the street for that sector and the noise from the media is almost entirely negative (a good sign). But it is exceptionally ballsy to say the least. I remember last time that when one bank went down, they all went down and it looks like one of the big boys of the banking sector is about to go down hard. You know which one I mean. 

There is no diversification in buying 20 sovereigns either.
The dividend is a bonus and not the reason for buying the shares - the potential for capital growth on a solid bank with an incredibly low P/E ratio is making my decision.
I am hurting from the collapse of Northern Rock ( 100% loss ) and also losing heavily ( 50% ) from an investment in Lehman Bros and I continue to lick my wounds having owned RBS, but equally so I was a silver stacker when you could not buy a one ounce silver Kookaburra for under £30.  It's all about risk and attitude to risk. Are you referring to DB ?

[HawkHybrid]

1 hour ago, Pete said:

No-one can predict the future PM spot prices.
Forget trends, algorithms and extrapolations - easy to fit theory to past events.
If guaranteed forecasting was possible we would all be trading paper contracts on huge margin deals.

If you have spare cash to invest why not buy some Lloyds Bank shares as the pundits in the know seem to believe they are cheap at the moment and next year may pay out close to a 6% dividend. There is also risk buying shares, but I am buying over 20 sovs' worth of LLOY first thing tomorrow. Worth a thought at least unless you have fallen in love with metals.

 

my guess is if lloyds pays out 6% dividend next year, it will

go hand in hand with a 6% drop in their share price?

I would not invest into bank shares until interest rates rise

to at least historic normals, ~4-5%. higher interest rates are

bad for banks right now and higher interest rates have yet

to materialise.

I still think gold will rise slowly from the us election and into

the first few months of 2017.

the media overreacting means little to me, hardly proof that

blood is on the streets. the last time around the time to trade

(buy) was when banks lost about 90+% of their share price.

 

HH

[KDave]

25 minutes ago, Pete said:

There is no diversification in buying 20 sovereigns either.
The dividend is a bonus and not the reason for buying the shares - the potential for capital growth on a solid bank with an incredibly low P/E ratio is making my decision.
I am hurting from the collapse of Northern Rock ( 100% loss ) and also losing heavily ( 50% ) from an investment in Lehman Bros and I continue to lick my wounds having owned RBS, but equally so I was a silver stacker when you could not buy a one ounce silver Kookaburra for under £30.  It's all about risk and attitude to risk. Are you referring to DB ?

Apologies you are correct, diversification is not the problem here I am sure we are all diversified, it was incorrect to make the point.

It is DB I am referring to which I would have thought is the single most compelling point on why now is not a great time to buy banking shares. But I could be wrong for the previously mention reasons, lots of positives to Lloyds as you say. Good luck with your investment if you decide to go for it mate hope it works out well.

@HawkHybrid I was referring to sentiment of the sector in general, but admittedly the stuff I have read is biased to the bearish side generally. An over reaction it will be, no doubt.

[walesdave]

So....last Thursday wasn't a 'bad' time to start stacking again, but looks like prices are dropping so think I might get a couple more Britannias or Krugerrand (something different!) in the morning, just going to see if the drop continues or levels out....

Just out of interest, does anyone else automatically think of Joss Ackland in Lethal Weapon 2 when talking about Krugerrand 

[silverin]

On 28/09/2016 at 22:27, sovereignsteve said:

If you're talking "stacking gold" then there's a good chance that anytime soon is a good time to buy, for long term holding. Things can only get worse in the world economy/banking world.

However, if you're talking "collectable sovereigns" then maybe now isn't the best time to start as prices have risen significantly recently.

The gold spot price has traded into a very narrow channel for the last couple of months so there's a good chance of a significant move soon, up or down. Which way do you think it will go?

Good points @sovereignsteve

I agree, now is not a good time for collectible sovereigns. 

Re stacking gold, anyone who has been buying or following gold for a long time can testify to it's relative volatility

I would hold off personally.

 

[JB3]

The right time to invest is when you have the money.

 

This month I've bought a little more gold.

I've also doubled my (albeit modest) position in Lloyds.

 

Because I had the money.

[HawkHybrid]

the technique is to have funds that you are

prepared to allocate to buying available.

http://www.gold-eagle.com/article/stock-markets-and-precious-metals-are-still-choppy

 

Quote

Stocks are exhibiting more choppiness and weaker action these days as we move back into earnings’ season. This motivated me to exit stocks. In accord with my chart analysis, I’m in an all cash position once again with not much on the horizon for a couple weeks.

 

take control of your finances. don't let your

finances dictate your trading/investing actions?

 

HH

[vand]

If you are fretting that the GBP might gain an extra 5% purchasing power compared to gold then you have wholely missed main point of buying and owning physical PMs.