Thursday 22 April 2010

Buying Gold

Gold priced in US Dollars (USD) and gold priced in British Pounds (GBP) remains above its historical real (after inflation) trend line price and above its historical real historical average price. It is however still below its historic real highs priced in either of these currencies. I’ll try and get monthly updates up for gold in both currencies in the next few days however today I’d like to report a buy/sell decision that I have made. I try and report every one of these (but I’m sure I’ll forget to do this occasionally) so that you can track what I’m up to.

This facts about the current gold price is all interesting information however I do not make decisions on my retirement investing portfolio based on this information. If gold were ever to become extremely over or under valued I might revisit this statement however I have clearly set myself a mechanical system of asset allocation which is based on a strategic asset allocation with a tactical asset allocation mixed in. For those new to the blog you can read all about this by links in the right hand side bar under the heading ‘my low charge portfolio’.

My desired low charge retirement investing portfolio mandates an allocation to commodities, which in my case is physically allocated gold held via an exchange traded commodity (ETC), of 5%. I have been adding to this regularly over the past few months but it is still to low at 3.5%. Today I have boosted that by another 0.5% by buying with some of my cash. This brings my gold allocation to 4% which is 20% off where I would like it to be.

As always DYOR.

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