My Favorite Precious Metals Vehicle
This is my initial post, as I too just registered upon seeing this morning’s invitation to do so. I have enjoyed the many postings, opinions and comments and hope to occasionally have something to contribute. Chartsmaster I first got interested in precious metals and in particular the miners in the late seventies. Homestake Mining and Campbell Red Lake come to mind. I came across a vehicle back in early 2001 that I researched and began recommending at $4 per share. I have continued to this day to advise anyone seeking to protect their wealth from dollar debasement and loss of purchasing power to make this vehicle a large part of their portfolio. Unlike paper derivative ETF’s or mining stocks, CEF provides direct exposure to physical gold and silver. The Sprott Physical Gold and Silver Trust (formerly Central Fund of Canada) holds 50% gold and 50% silver bullion. You get the benefit of gold’s usual upside leadership and eventually the added kicker of a late stage rocket booster when silver usually takes over and out performs as a precious metals bull market develops and progresses. You won’t make the outsize gains of a mining company when a bull market is raging, but you avoid all the inherent risks that owning miners entails. I love the benefits of owning a great major like NEM and the exciting potential of an explorer like MAG, but every investor can benefit by holding a core position in CEF to balance their portfolio.
Welcome to the tent Chartsmaster
And thanks for reminding us of CEF.TO
I agree…it is just like holding Physical Gold and Silver but much easier to trade than schlepping all that metal around
cheers
Fully
Mr Summarizer,(Fully)
How does CEF compare to – SII:CA
SPROTT INC: Canada
Welcome Chartsmaster and I agree about CEF! I am so glad I did a roll call here yesterday. Come into the light and bathe in the warm tent waters brothers and sisters. The bull market is just starting! A year from now you won’t be a newbie 🙂
Another reader emailed me that the present holdings of CEF are 79% Gold and 21% Silver.
I suppose it changes periodically but it is still the best/ easiest way to participate in the Gold/ Silver Bull
in Physical holdings and it is liquid like an ETF.
Yeah it is good for trading but one should have the real metal stashed away then play with the paper.
I disagree about trading it. Much better vehicles for short term trading. Agree that one should have the metal also, but this is the closest thing to actual metal that one can get to without premiums and as I stated, if holding throughout a precious metals bull market you benefit during both the early stage when gold out performs and eventualy when silver kicks in with it’s outsized returns.
It is 63% to 336%. By ozs it needs to be considered. Price of gold has gone up compared to silver. It shows up up in GSR. AS GSR changes it will change.
Thanks for all the comments and feedback. My bad for not taking into account that over time the balance of gold to silver has changed. As I mentioned I have followed CEF since 2001 and didn’t really think about it in terms of the huge change in G/S ratio. However, that doesn’t change my thesis for using it as a core position.
I have PHYS, which is the same but only gold.