Boosting Our Gold Holdings
We made a small adjustment in allocation of assets in our taxable investment accounts. I can’t say I feel great about it but that’s OK.
Anyway, one of our more conventional holdings – a dividend ETF – had been performing very poorly and way below the expectations we had when we bought it. It also replicated assets we own in our tax deferred accounts. I was tired of watching it move down or sideways.
What if the gold bugs who predict gold to hit 5,000 were right?
So I decided to make a defensive move and make Mrs. ToughMoneLove happy at the same time. I sold the dividend ETF and used that cash to buy shares in the SPDR Gold Trust EFT (GLD) on a small dip. Owning shares in GLD is the closest thing to owning gold bullion without having to keep it in your personal storage vault. I have no interest in maintaining a stash of gold coins in the house.
So now instead of wondering if I should buy more gold, I will be asking myself when I should sell it. That has always been a problem for me in analyzing gold as a long term investment.
The odds are we will not sell it until we are ready to spend the cash on a non-investment. Maybe that will be after gold prices make another major run up. If so, will that mean that our economy is in the tank? I hope not.