my goal is to buy things when they are cheap according to the earnings formula.
It's true energy is getting hit pretty badly but commodities have been hit pretty hard, pricing in some sort of global recession and many of the energy stocks are now very, very cheap.
It seems like between the gold and the energy stocks you've chosen a portfolio direction that is potentially sensitive to economic news and therefore potentially more volative. I can't remember if that that was part of your original objective, but being down 5% doesn't seem like a bad swing given the underlying investments.
There are several more I have been looking at an some I have bought personally. Among these are Jazz Pharmaceuticals (JAZZ), Northern Oil & Gas (NOG), and Yelp (YELP). Lots of energy stocks are cheap but I think that's because they are discounting recession in which case oil could go down to $70 so it may require patience.
Re: Patience
ProfR
5/18/2012 7:34:24 AM
Yes, I like investing for the longer term. So, quality investments will do well over time. If you were going to add one more stock, what would it be?
Re: Patience
Phoenix
5/18/2012 5:03:25 AM
I think the portfolio make up is fine it's just the market trends right now that are not cooperating. It should pickup in the long term. I think it's best to wait and see.
@Broadway
Great question, and I have no idea how you would find out that information. Most of the gold sales are private and gold dealings are notoriously secretive.
@Scott, now there's a blog post topic for you: who bought that gold, did they hold onto it, how many islands have they bought for themselves since then (or how many F-16s and M-4s if they are a sovereign nation)? Is that kind of stuff -- massive gold deals involving nations -- recorded and trackable?
It's comforting to be purchasing along with a central bank, as long as it's not Gordon Brown and the Bank of England.
Gordon will now live in history as having made one of the worst central bank moves in history, selling 395 tons of England's gold reserves near the market bottom from 1999-2002, at an average price of $275. In fact the BOE was instrumental in creating the bottom in the gold market.
The buyer at the other end of the deal must be pretty happy these days!
Gold may be slumping but Central banks across the globe continued the now established trend of net purchasing with demand in Q1 2012 reaching 80.8t, according to the World Gold Council. Demand was driven by Eastern Europe with Russia and Kazakhstan adding to their holdings and accounting for a substantial amount of the purchasing. Mexico's central bank made the largest single purchase of 16.8t.
So you appear to be in good company @Scott.
Still trying to wrap my head around the fact that gold miners are struggling. Realistically, it doesn't make sense.
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