Gold and Silver

Everyone is talking about gold and silver at the moment, and whether or not they are in a bubble.

Ultimately people invest in precious metals as protection against inflation, protection against fiat currencies and protection from the government. At the moment it appears there is still a long way for the bull market to run as the markets have not gone parabolic.

Silver has had a brilliant run, reaching $49.50 per troy ounce at the end of April. I think there will be some consolidation around this price as silver has had a brilliant run, it however remains a hold for the long term.

If you want to invest in precious metals take a look at buying shares in LON:PHAU and LON:PHAG. These ETFs are backed by physical metals so they will closely match the value of the underlying metal. Remember they are denominated in USD though, so you may be exposing yourself to currency risk depending on what currency your liabilities sit in.

I will talk about owning precious metals in the form of bullion/ coins in a later post.

2 thoughts on “Gold and Silver

  1. It appears like this site is a superb reference point for financial and investing advice. I’ve begun taking into consideration investing in Swiss annuities to ensure a way to obtain retirement income but want some more tips first. Switzerland seems like a good place to invest, and I am very curious whether that is true for Swiss annuities as well. Do they provide the same asset protection as Swiss accounts? What about privacy? Any advice would be really appreciated.

    • Switzerland is indeed a sensible place to invest in these dangerous economic times and provides a haven from the economic turmoil. I have indeed looked into the possibility of investing in swiss bank accounts but some of the costs were a bit of a turn off unless you have in excess of 1mil CHF to invest. I’m afraid to say that I do not know anything about the rules and regulations relating to swiss annuities. However, one thing I will highlight is the exchange rate risk associated with investing in Switzerland. The Swiss Franc strengthened over the Summer to crazy levels, this meant that the government wanted to step in a protect the currency from appreciating any further because it meant Swiss exports were no longer competitive on world markets. So beware of Swiss government intervention in the currency markets!

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