I am stacking and i am coming close to my goal of physical.
I have gotten advice to go into mining shares with the rest of my investment money. The advice i have been given is to buy shares, because they tend to go 5 to 40x even higher then the physical metals do.
Do you recommend buying mining shares or just putting it all in physical metal?
I also get perplexed around what to do if shares do go parabolic…
Do i hold the shares until a new currency gets flipped(amero). When should an investor get out of the mining sector?
Am I in danger of losing the shares completely in the face of government intervention..
I guess I’m asking for a recommendation about physical metals vs. the shares and what my potential exit strategy would be from mining shares.
Appreciate the input
Personally I am almost completely out of the mining shares and into physical gold and mainly silver.
Yes, the mining shares have the potential to have exponentially greater gains than the underlying metals, and in the coming manic phase of the bull market they will likely be bid up indiscriminately by the general public, similar to the dot com start ups in the late 90′s.
However the main risk as far as mining shares is broker re-hypothecation risk, and nationalization of the mine. I would recommend holding no more in paper assets than you can afford to lose. If you do choose to own the miners, it is imperative to take delivery of the actual stock certificates if you are able, or at the very least, register your shares in your own name rather than in street name, which allows your brokerage unlimited lending for shorting purposes of your own stock, and re-hypothecation to the Nth degree.
In my opinion, nationalization of mining companies is a MUCH greater risk than a door-to-door confiscation of gold or silver. Millions of below ground ounces of gold and silver could be confiscated by nationalizing the mining sector with the stroke of a pen. A door to door confiscation effort of gold and silver would result in extremely little phyzz for the DHS Nazi’s, and an average life span of about 15 minutes for an agent in that line of work considering that probably 90% + of PM investors also are gun owners and are about as likely to give up their wives or their virgin daughters as they are their phyzz.
But that’s just my opinion. If you do want to trade paper, do your research and buy established companies in good political climates with brilliant execs and leadership. Never underestimate the capability of dumb management to burn through investors cash.
Be prepared to sell 1/3 of your holdings when your stock’s weekly chart resembles a rhino horn, and buy when its weekly chart resembles a fishing pole.
Sell it all and walk away when the first of your wives’ friends gives you a hot tip about a gold or silver stock.
Hope this helps.