Long on Gold

Discussion in 'Commodity Futures' started by Psycho, Nov 29, 2008.

  1. Psycho

    Psycho

    First of all, Any advice greatly appreciated.
    I don't like trading stock. I don't have the time to keep up with it like I should since I work a full time job and I own a business.
    I only got involved because I was taking a beating in the index funds I had thru my work 401k plan. Our funds were down 56%ytd. I saw gold, auto, natural gas were all down 70% or more and since I had lost so much I guess I am all in. I figured I could trade down and rebound to a gain.

    Toward the end of Oct. I moved 60% to Gold mining stock thru Fidelity Select Gold and 10% to Fidelity Select Natural Gas. Last week I moved the remaining 30% to Fidelity Select Auto. As you see our work 401k funds are thru Fidelity. They have no stops in their funds and we can't get out at a moments notice like traders. As of today I am ONLY down 38%. So I have had a 18% gain in the last week due to the jump in gold and the market.

    If and when I get back to even I plan to get out ASAP. I am not looking at making a living trading. I am to dumb to know who to listen to on the tv, blogs and the forums. Between gold/xau, gold/hui, gold/oil, gold/s&p and the historical trends of gold and the dow being at 1:1 during lows on the market, I am unsure what to do.

    I believe there is a huge effort to keep the dollar elevated and gold down. I don't think the goverment can keep printing money and it not have an effect on the exchange rate with other countries with sound banking practices.

    I moved the money to Auto cause I think they will get the bailout and the market will react quickly. I moved to gold cause the price was at a recent low and my index funds were taking a beating and my reasearch said gold was quick to rebound after a market correction. I bought Natural Gas cause the stocks were down and the next adminstration may adopt the Pickens plan. With Natural gas being down and coal up it is becoming more attractive to energy producers. The combined cycle and combustion turbines are at or near production costs of $40 a MW from thier peak of $88 last winter. If the Pickens plan is adopted the stock price will also jump. I am in Natural gas at least till spring.


    During the last two market corrections I rode it out in the index funds but since then my 401k has increased to the point where I need to get more involved or get out and into bonds. I would like get out on a high if possible but the next market high may be in 10 years when I retire. The goldbugs think gold will go as high as $2000 and even higher on down the road. I want to believe, but everyone I know is talking about buying gold. Only part of them actually follow thru and buy.

    After the Auto stocks rebound from the bailout I plan to move that money to oil stocks as I see oil rebounding and following gold higher. About the same time the dollar SHOULD drop, resulting in a further jump in gold. After gold gets to 1000 and 1400 I plan to move the gain to bonds and let the rest ride.

    I am trying to figure out where to move gains to other than gold, natural gas, oil and Auto stock. I am scared of Tech stock and service companies in this market. I know I am looking for the next big gainers and no one knows for sure, but, I am just looking for opinions from someone other than paid insiders.


    I may be wrong about the next few months and my stock picks. I was wrong to let someone else manage such a large amount of money.