I am fascinated by the analyses that show how inserting gold into a portfolio tends to mitigate volatility while not (proportionally) negatively affecting returns.

Thank you so much for walking through the statistics and all the parameters!

Fantastic video… AGAIN! Well done sir….. Love these videos. I learn a ton!

I’m new to the channel and I love it. Thank you for being one of the only level headed investment channels that actually take time and teach you on KZread!

Gold is one of those topics that tends to get people worked up, either for or against it. My view is more nuanced. Gold is just another asset class that works well in some economic environments and not so much in others. IMHO gold is the financial equivalent to an insurance policy. It is basically just cash in another form. Most people would not want to own a portfolio without a cash reserve. Gold adds a level of diversification to your cash reserves. The advantage that it has over other forms of cash is that unlike the dollar, pound, euro, franc, yen and the other fiat currencies, you can't arbitrarily push a button and print or electronically create more gold. In short, gold is the one form of money that is impervious to the knavery of politicians and central bankers. And with the US Dollar as the world's principle reserve currency since 1973, that means gold is mainly a hedge against the dollar. If the dollar is doing well and people have confidence in it, then gold tends to lag. If people are getting nervous about the dollar (too much debt, too much money printing, inflation etc.) then gold tends to rise as people react to dollar weakness.

@bar8665

2 жыл бұрын

I agree with basically everything you said. I view gold as simply "real money" and any fiat (and now crypto as well) as simply "currency". Money can and has been used as currency, but should not lose it's status as money because it is no longer used for buying and selling every specific thing. Appreciate the comment, cheers.

@thehylander266

2 жыл бұрын

I would disagree that gold is like cash. I would say that gold is more like bonds but with real yields. Gold not only keeps up with inflation, but does appreciate over time by a few percent as well, in inflation adjusted terms.

Thank you for this video!

Thank you so much for all the great info... I only knew about Delta and PE ratios before today... You should be charging for these classes. So much good info

I’ve been called crazy only until this past year. Gold is hands down the direction investors need to go this next decade as equities are oversold and commodities have basically been left in limbo. I hold far more gold than most “traditional” investors hold but I sleep well at night. The US dollar is in a transitory period. Gold has always and will always be money. Don’t believe me. Hold an ounce of gold then hold a Bitcoin. The comparison is very clear.

Hi Rob, Cannot thank you enough for your awesome advice it has guided me into my first few months of retirement! I have a refinanced 2.25% mortgage and a SS payment that is about twice that. 20% of investments are in a Roth IRA with individual stocks, well diversified. Other 80% just moved from 401k to Rollover IRA. Doing DCA over 18 months into these Index ETFs. VTI-40% VXUS-25% BND-25% VBR-10% I am anticipating ~ 2% withdrawals. I have ~ 5% of my savings in physical gold. Besides the diversity and hoping for upside, I do think of it as another source of emergency funds if needed. I'd like to increase gold to more like 10% of portfolio. Lastly, I have Thank you again and Best Regards!

If you want to see another pop in Sharpe and Sortino ratios, get rid of your corporate bonds/total bond funds and only use treasuries (per Bengen and Trinity studies) in addition to adding 10-15% gold.

@JamieElgie

2 жыл бұрын

He just should listen to your podcast Frank!!!

@timelston4260

2 жыл бұрын

I've been listening to Rob's and your podcasts for about the same length of time. My impression is that Rob is not much aware of the principles you espouse. But it was nice to see him be surprised at how gold performs within a portfolio. What I like about Rob is he is open to continue to learn, and it's fun to watch him learn. I hope he gives your Risk Parity Radio podcast a listen.

Will you be adding this to your podcast so we can listen to it while driving?

The biggest takeaway from this is that you cannot ignore the sexy metals. How much value do you assign to the feeling of owning beautiful gold coins, in vacuum sealed cases?

From an investment POV as described here, is "gold" physical or ETF?

Bishop to f6. I have M1, I prefer to own stocks inside of my pies instead of ETF's except where the ETF represents an asset that I couldn't put in a pie. Example: Nasdaq top 10 stocks, TIP, GLD, GSG. I re-evaluate/balance the Nq10 pie once a quarter. Also, I vary the allocation depending on the season. Oct-May I weight stocks more heavily than other assets, Jun-Sep, I weight other assets more heavily.

Assuming you can stomach the ride, a high SD is good when contributing level $ on a fixed schedule (if you are a long way from retirement) because the high SD drives the average cost per share bought down. A high SD is bad when drawing down your investments (retirement) on a fixed basis because the high SD drives the average price per share sold down.

How about balance buying cripto and invest the same quantity in gold

I have 15% gold, 20% long term treasuries, 5% short term treasuries, and 60% diversified equities. Each on its own isn't great, but as a recipe it's strong on perpetual withdrawal rate, short drawdown period, low drawdown percentage, and high average return. Equities include 20% small cap value, so that helps the average return.

@bar8665

2 жыл бұрын

One question, when did you offer your 20% long term treasuries to the gov and what was the interest rate? Because the interest currently is so low I can't imagine anyone doing it.

@timelston4260

2 жыл бұрын

@@bar8665 For me it's not about the interest rate but about the negative correlation with the stock market. Money tends to pour into long term treasuries when the market is crashing. When investors are fleeing treasuries I am buying shares of treasury funds, so when those same investors are fleeing equities I have a lot of treasury fund shares to sell and buy shares of the funds of equities they are fleeing. Also, I've noticed over the years that predictions of how bad treasuries will perform are rarely ever correct. No one knows how treasuries will actually perform during any given period, and their performance is often surprising. But over most time periods they are negatively correlated with the stock market, so they are one of the best diversifiers in a strategically allocated portfolio without using leverage.

@bar8665

2 жыл бұрын

@@timelston4260 ah I see, thank you for the response.

Saludos desde Ensenada, Baja California, México

instead of using bonds I was thinking about using non correlating assets ie vym, gsg, iemg, vwo, vnq, to add to vti, vxus

When Rob talks about adding gold, does he mean physical gold or gold mining stocks/funds? If the former, the Portfolio Visualizer analysis omits carrying-costs and risks, which are not inconsequential.

I don’t invest in gold. What tickler are you using for gold?

@10mesqueunclub27

2 жыл бұрын

PHYS is one of the best because it’s physical gold not paper gold like most other Gold funds or etf

the only explanation is that gov print more money as they declared, maybe more than 10%, that is why annual return for gold is 8% during inflation period

I'm not sure how gold is affected by crypto. It's not as if the dollar is based on gold. It's not a competing currency in and of itself. It's bling, and it's a component used in some technology.

Don’t think standard deviation is a good proxy for volatility. Statistical measures like mean and std deviation don’t care about the sequence of the data points, only their values. To put it another way , a monotonically increasing price over a year that starts low and ends high in a nice constant slope can have the exact same mean and std dev as a rearrangement of those prices to form a rather jerky sequence of this prices that swing wildly. One is highly volatile and the other not volatile. Both with the same mean and std dev.

the channel "next level life" has analysis on guard rails

Bishop F6

12:00 I think correlation isn't whether two securities are typically both up or both down. Instead is whether the returns are typically both above their mean or both below their mean. Basically it subtracts out average returns

The minutiae king.

The last 40 years have seen treasury yields decreasing which means bond prices have been increasing. Treasury yields now near zero. Bonds are now the most expensive in history. Treasury rates are now rising. They may rise for years. Stocks are at all time high valuations. Everything eventually reverts to mean. Expecting the investments style (60/40) that has worked for the last 40 years to work for the next 40 years may be looking in the rear view mirror. Golds performance in the last 40 years may not be the same as in the next 40.

Can you make shorter video summary of this topic?

@GrantValdes

2 жыл бұрын

lol

Bf6

21:35 A person who invests the same amount every week will prefer more volatility. It will heighten his return, since he buys deep more often. 2-5% in gold is reasonable. Gold is what men give women to make them change their mind. (Speaking of doomsday scenario) Every piece of electronics have some gold in it, which in not recycled. There is no way it goes down in a long run. 48:45 Perhaps the answer is in rebalancing. Always making sure is it 50-50. Selling one to buy the other and vice versa.

I only have to disagree with one item. Gold is not really a hedge against inflation, because there is no direct correlation between gold and any other economic factors... If you look at the price of Gold over the last 100 years, instead of steadily climbing up by 3 % each year to offset inflation, there are huge downturns in the price of Gold...

Now run the same analysis but with Bitcoin instead of gold

@SKITTLELA

2 жыл бұрын

Backtesting will be crazy because BTC has only been around since 2009 and started at zero. Doesn't seem like a fair comparison, tbh.

@Rob Berger 10% ARKW 60% silver 30% gold Do you like this portfolio? The barbaric relics have done very well since 2000

What are your thoughts if there will be a Santa Claus rally this year?

Increase your volume

I sent you an email recently, Rob. I hope you can address the issue in a future video. Thanks for the great content!

The average American is gambling in the stock market while the smart money is buying gold and silver if you don’t hold it you don’t own it once the stock market casino collapses I believe that you will be able to exchange your gold and silver for property in my opinion

Love all your advice except for this. This is just wrong in so many ways. This def puts a dent in your credibility.

@erickshaffer6615

2 жыл бұрын

Would you mind explaining why? This comment isn't very helpful otherwise.