drbubb Posted May 6, 2011 Report Share Posted May 6, 2011 Beating Buy and Hold (thru disciplined speculation) Long Bias + no gearing, Options to limit Price Risk ======================================================= Basically: (for definition, see post #539 ) I intend to have a Physical Silver investment at the Core of my two portfolios, and then speculate around that core, using the profits of speculation to boost core investment in Silver. UPFRONT WARNING : This thread is not for everyone. Implementing these strategies & getting the timing right requires more than skill. You need the right mental and emotional attitude (and a some real luck) to buy at the right time. And you also have to be willing to be wrong sometimes, and live with the implications of being wrong. That may mean entering trades and exiting at uncomfortable moments. If this does not sound like your "cup of tea", then stick to simpler strategies. You will sleep better. WEEKLY Spreadsheet : http://tinyurl.com/beatingBH'>http://tinyurl.com/beatingBH Weekly Portfolio Updates : http://www.greenenergyinvestors.com/index.php?showtopic=14905'>http://www.greenenergyinvestors.com/index.php?showtopic=14905 This compares a 10,000oz Buy & Hold portfolio with two competing Alternative Portfolios: AP#1, which may have more trading; and AP#2, which will be a more passive portfolio. The idea is to try to beat the returns of B&H, with both Alt. Portfolios. RECORD ====== Record : B&H Portf. : Alt.Port #1 : Alt.Port #2 : -SLV- : -DXY- /--CRB-- real.SLV 28 Apr.: --- $4,800 K : - $4,800K : - $4,800 K : $47.26 x73.12 / 3.7056 =# 9.326 06 May: --- $3,550 K : - $4,799K : - $4,800 K : $34.48 x74.84 / 3.3735 =# 7.650 13 May: --- $3,536 K : - $4,916K : - $4,802 K : $34.39 x75.71 / 3.3853 =# 7.692 20 May: --- $3,503 K : - $4,953K : - $4,862 K : $34.18 x75.66 / 3.4156 =# 7.571 Latest: ====== : B&H Portf. : Alt.Port #1 : Alt.Port #2 : Vs B&H: --- 100.0% - : -- 141.4% : -- 138.8% : INTRO: This is a spinoff from the "$50-ish Peak in Silver" thread, and is intended to show that the Buy & Hold strategy requires a level of confidence and complacency that can be dangerous to your financial health. No one really knows where the price is going to be in 3-5 years (just look at the "miss" by the famous Jim Sinclair on his "$1650 by the end of January 2011" - he was right directionally, but missed by hundreds of dollars.) If you believe and act on these types of point forecasts, eventually you may find yourself on the wrong side of a huge market move. Learning to trade in and out, and protect yourself with stops, options, switching, and hedging may yield a far better result. Dynamic Charts - - - - - - -Gold- - - - - - - : - - - - - - - - - -Silver- - - - - - - - - - : - - - - - - - - - -Copper- - - - - - - - - - : - - - US$ - - - : : : My favorite moving average is 144 days - Have a look: + In Gold/GLD + In Silver/SLV : a break is big trouble ! I am watching PHYS also ... update Gold ... update : 46p-MA : 17p-MA CHART - GLD ... update : Gold-Futs Favorite Silver charts ... SLV-intraday-chart : SLV-daily BTW, I think that final spurt in Gold was caused by a switch out of Silver into Gold by those who wanted to switch away from Silver near $50, but wanted to stay long precious metals. CHART - Silver ... update CHART - AG to CRB ... update The early entries on this thread, were posted on the Silver $50 Peak thread, or on DrBubb's diary. Initially, I was focussed on Bob Chapman's position in the Silver market. He had said that he was long with an average price of $18 per ounce. To make it simple, I translated that into the following... "Simplified Portfolio" of a Perma-Bull: ================ Silver: 100,000 oz. x Cost: $18 per oz. = Overall Cost: $1.8 Million Chapman had recommended "Staying long, and buying the dips." I had thought that after such a huge run-up from $18 to $48, such a complacently bullish strategy was dangerous and not opportunistic enough to satisfy those who realise prices do not always move straight up, and that parabolic moves are usually followed by big drops. Taking some profits, or hedging, near $50 seemed highly prudent, even for those long term bullish on silver. Can he really be sure that Silver will hit his $150-200 per ounce target ? Sure, it is possible, but I also give some possibility to $1,000 - 2,000, and want to let the markets tell me how to trade it. This, I think, will be better than stick to some preconceived target, supplied by The Piper or some other illuminary, which may prove to be an illusion. I decided to compete with the "Perma-bull Portfolio" shown above, with two trading portfolios that I would change from time to time. == == == Long Term Gold LINKS: ===== Gold charts--- :: http://www.kitco.com/kitco-gold-index.html Silver charts- :: http://www.kitcosilver.com/charts.html Adv SLV charts :: http://www.advfn.com/cmn/fbb/thread.php3?id=25153589 Weekly update- :: http://www.greenenergyinvestors.com/index.php?showtopic=14905 Wk spreadsheet :: http://tinyurl.com/beatingBH Link to comment Share on other sites More sharing options...
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