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Time to relook at gold?

Iran rial plunge is real and just happened this week with just limited sanction.

can consider buying gold to hedge against inflation, but buy at market price, and holding for a long period of time.

better to get gold etf or gold companies via unit trust?

gold etf has counterparty risk(how do you know the other party has the gold?).....if u are investing huge amount like $70,000, then you can try UOB gold cert......cheaper transaction cost....they sell by 1kg.......

If small amount, you can try UOB gold saving acct.......you can buy gold by grams but higher transaction cost......

2 cents worth....

I think gold by far is the most safe investment. But i do feel that we should look at silver too. It is still under price.

Gold's 'Death Cross' Isn't All That Worries Investors
http://finance.yahoo.com/news/golds-deat...33712.html

Forget the Death Cross, Gold Is a Buy: Pento
http://finance.yahoo.com/blogs/breakout/...35990.html

http://www.asiachart.com/commodities.html

(short term looks bad.....wait for a while.....might be an opportunity to accumulate....2 cents worth)

Just want to share with you guys my personal experience:

I was seriously considering putting some $$$ in gold 1-2 years back. One day, I passed by a jewllery retail shop that had some 10g, 20g, 100g and 1kg gold bar on display. I stood outside the store in front of the display for a while tried looking at the price tag. I couldn't see the 1kg price as the tag was placed upside down. I think it was deliberately done that way to encourage potential customer to walk into the store. A sales staff came out to talk to me. I then asked her about the price of the 1 kg gold bar. It was around something like $60k plus if I remember correctly. Sure it was the market value at that time. Then, I asked her the second question: How much would the store pay if I were to sell them the same gold bar? The answer was around $50k plus. 20% below market! In my mind, I concluded that the store was only interested in selling not buying back.

This is logical to me. Why would they need to buy back gold from a man on the street if it is not very much cheaper than what they could get from their regular source? So to me, this is not a good way to invest since the investment would need to appreciate 20% or more inorder to break even. I may be able to sell at a higher price at other store but that was not my consideration. What I don't feel comfortable is that we pay market price when we buy, but when come to cashing it out, we are at the traders' mercy.

Few years back someone was complaining in the media about a bank was not interested in buying back gold deposite certificate from investor who bought from them. Same thing, the bank are interested in selling but not buying back. People on the street are always at the mercy of the big player.

I considered buying gold eft like the SPDR but was put off by the fact that are cost involved like safekeeping, trustee fee blar blar blar... And also the counter party risk. So if the gold value remains unchanged, our holdings will be eaten up by the fees incurred.

So gold a good investment for ordinary man in the street? Definitely not for me.

Yes bid/ask spread risk is very real. Same thing for big ticket EXPENSE items like cars. Even worse for diamonds once you step out of the shop Hence it is good practice to always test the liquidity of the instrument by selling some first and buy back later. This is a HUGE difference from rollover though they are academically the same.

Not sure if anyone posted this before:

http://www.myfoxny.com/story/19578206/fa...-manhattan

When the incentive is high enough, people will do funny stuff. The most interesting quote I heard from this saga is "people say always buy from reputable dealers; problem is the seller is reputable". This old adage is not true, the other one about caveat emptor remains valid.

(21-02-2013, 09:06 AM)zhangwuji Wrote: [ -> ]Just want to share with you guys my personal experience:

I was seriously considering putting some $$$ in gold 1-2 years back. One day, I passed by a jewllery retail shop that had some 10g, 20g, 100g and 1kg gold bar on display. I stood outside the store in front of the display for a while tried looking at the price tag. I couldn't see the 1kg price as the tag was placed upside down. I think it was deliberately done that way to encourage potential customer to walk into the store. A sales staff came out to talk to me. I then asked her about the price of the 1 kg gold bar. It was around something like $60k plus if I remember correctly. Sure it was the market value at that time. Then, I asked her the second question: How much would the store pay if I were to sell them the same gold bar? The answer was around $50k plus. 20% below market! In my mind, I concluded that the store was only interested in selling not buying back.

This is logical to me. Why would they need to buy back gold from a man on the street if it is not very much cheaper than what they could get from their regular source? So to me, this is not a good way to invest since the investment would need to appreciate 20% or more inorder to break even. I may be able to sell at a higher price at other store but that was not my consideration. What I don't feel comfortable is that we pay market price when we buy, but when come to cashing it out, we are at the traders' mercy.

Few years back someone was complaining in the media about a bank was not interested in buying back gold deposite certificate from investor who bought from them. Same thing, the bank are interested in selling but not buying back. People on the street are always at the mercy of the big player.

I considered buying gold eft like the SPDR but was put off by the fact that are cost involved like safekeeping, trustee fee blar blar blar... And also the counter party risk. So if the gold value remains unchanged, our holdings will be eaten up by the fees incurred.

So gold a good investment for ordinary man in the street? Definitely not for me.

IMO, for physical gold, we can classify into 3 categories

1. Jewellery - Unless it's special eg. designed by some well known designer (preferably dead, meaning limited nos. left in mkt) or an antique, Bid/Ask is the highest, IIRC 20-30%.

2. Collector - Depends on the nos. minted and the designs. The rare ones are sold at a much higher premium to gold price, same for resale. But, may be hard to sell at the market price unless you can find another collector. Bid/Ask depends on finding a buyer...

3. Bullion - These are the ones for investors. The bid/ask spread shouldn't be very high. I did a quick check using UOB prices and it's ~0.4% for the kilobar. I don't think they'll buy from you if your gold is bought elsewhere.

I have been thinking about 'investing' in physical gold for a while now.... Only started on (2) as a hobby but perhaps I better start collecting some bullion coins so that I can sew into my clothes or hide in my shoes in case we have to run away from Singapore like refugees in the future... Hee...