RE: RE: Just Posted Investor Relations Email-
Very valid points, which primed me to think about my approach and a recent helpful article I read and thought I'd share.
Right now I am long both metal (Au and Ag) and shares, mostly juniors and intermediates, with some O&G stocks and about 25% in cash. I also get Sinclair's emails as well as a few other services, including Casey Research, and as a result will be gradually increasing my cash component to over 50% over the next few weeks at good exit points. Through Casey, I was linked to the following report from Phoenix Capital entitled "Will Gold Miners Act Like Stocks or Gold During the Crash?". Many of you have probably seen this article already, but it is well researched and its arguments are pretty sound. Here is the link:
https://www.gainspainscapital.com/index.php?option=com_content&view=article&id=107:will-gold-miners-act-like-stocks-or-gold-during-the-crash&catid=42:commodities&Itemid=73.
In a nutshell, this article -- which is far from the only one on this point but in my view summarizes and supports its propsition better than most -- says that if there is another leg down in the markets, that will trigger another deflationary selloff in stocks and other assets. Gold and silver metal and stocks will get caught up in this landslide, although the fall won't be as dramatic as in 2008. It then says that gold and silver mining shares will initially drop along with other stocks, but will recover much faster and start to move back up, along with the metals themselves. Casey and the vast majority of other prognosticators that I follow are firmly convinced that this will all come to pass sometime this year.
So in my view, the smart play will likely be to get into at least 50% cash now, keeping only physical metal you already own and shares that you either believe are the "Best of the Best" (and will be much more resistant to selling pressure as a result) or for which you are expecting some very positive news in the not to distant future (which would present a better exit point).
I'm not an investment advisor and this isn't investment advice, but I think it makes sense and I'm implementing it. That way, I'll be able to sit back, wait for the next leg down with little worry, commit to new buy levels for both new physical metal and shares and then pounce when my targets are hit. If I'm wrong, my physical metal and "star" companies will still perform well. Personally, sometime this year I think we'll see Dow 7000, TSX 8800 and TSX-V 1100. Not sure they'll be the absolute bottoms, but they would definitely be better entry points than today.
GLTA
JL