Time to convert your silver gain into...

renman95

Gold?

In one year silver is up nearly 150%. Compare this to gold, up roughly 35% in the same time period, is now the time to take a little off the table and buy the more universally accepted gold?

A lot of attention will be on silver when it passes $50. I think between now and $50 is conversion time.

r95

dontippet

I started doing a little converting at $32.68. Boy was I wrong. So, it's hard to say. Right now, since silver is so high, it appears to me that sellers are easing up on their margins since profits are so high. So, I am buying both gold and silver, but at better margins than usual.

secondrepublic

Interesting observation. If you look at the entire "run" by both metals since about 2000, silver has increased ten-fold from $4 to over $40; but gold has "only" increased sixfold from $250 to $1500.

DrBuster

20:1 and I'll swap. Still too much % gain available for silver methinks.

renman95

<< <i>20:1 and I'll swap. Still too much % gain available for silver methinks. >>



Good point and I agree. It's 34:1 now.

The recent low point in the Fall of 2008 it was 100:1. That was a screaming buy.

Back in 2000-2001 it was only 65:1! ($260/$4)

mhammerman

Your intuition is good from my perspective. I'm going to wait for a local show in May and take a few rolls of walkers and washies and convert them to 1/10 oz age's. At $1500+ a copy, there's a lot of value in a one oz age and they seem to be getting a little bulky, cash wise, to be of much utilitarian use so I'm going to do what they call "diversify" my portfolio. Hopefully, I can find a righteous buyer of 90% that is hoarding a few 1/10 ozers. I think that $50 will be a real stunner for a lot of folk as it makes a tube of ase's a K and I would like to get into the 1/10's as quickly as possible after that mark. If silver keeps rising, I might let go of some ase's and get more 1/10's.

renman95

<< <i>Your intuition is good from my perspective. I'm going to wait for a local show in May and take a few rolls of walkers and washies and convert them to 1/10 oz age's. At $1500+ a copy, there's a lot of value in a one oz age and they seem to be getting a little bulky, cash wise, to be of much utilitarian use so I'm going to do what they call "diversify" my portfolio. Hopefully, I can find a righteous buyer of 90% that is hoarding a few 1/10 ozers. I think that $50 will be a real stunner for a lot of folk as it makes a tube of ase's a K and I would like to get into the 1/10's as quickly as possible after that mark. If silver keeps rising, I might let go of some ase's and get more 1/10's. >>



Great idea. There's a local show here in Western Colorado April 28. Conversion time...

pf70collector

Slowing my silver purchases for now. If it hits $25 I will buy again. Only thing I am buying this year are the 2011 5 oz Pucks since I will try to collect the series.

mhammerman

"There's a local show here in Western Colorado April 28. Conversion time..."

Please give the board a report of your experience and the very best of good fortune to you and your transactions.

ttown

I just add to what even is unloved and keep my ratios. That losing on the buy and sell it has to be a big swing to get anywhere in physical and is much better for the paper market IMO.

Now didn't we just go though this $850 mark with gold several years back? Now look gold could be almost double it's 79/80 highs while silver is just under it's all time high, it's about time and should be over $100 at least by now.

The flip side of this is gold/silver wasn't the so called 16:1 ratio when this started. Gold was 260ish while silver was $4.50ish, that over a 50:1 ratio so silver has done better than indicated. Considering that you just have to ask will this end up being close to the 16:1 ratio. who know

BAJJERFAN

<< <i>Interesting observation. If you look at the entire "run" by both metals since about 2000, silver has increased ten-fold from $4 to over $40; but gold has "only" increased sixfold from $250 to $1500. >>



It's like stocks. The average low-heeled investor can more likely buy a round lot of a stock costing $25 than he can of one costing $100. A one ounce AGE equals about 35 ASEs. It is much easier to sell smaller amounts with the ASEs too.

PerryHall

Doesn't your stash of PM's lose value when you convert since dealers buy at wholesale and sell at retail? I'll keep what I already have and buy what I think is currently undervalued compared to the other.

derryb

Selling now should only be done if there is a real need for the cash. Creating a need for the cash just to have an excuse to bail out does not count.

Justacommeman

I did convert some at $41.........Obviously, at this point in time it was the wrong move. Only time will tell if that changes. MJ

MilesWaits

I converted some rolls of silver rounds into less than spot ATB's; short of that, I am nervous about "trading up"

to Gold with the imminent loss due to premiums and spreads. I thought you were gonna say RE, Renman. NO WAY!

Miles

jmski52

I did convert some at $41.........Obviously, at this point in time it was the wrong move. Only time will tell if that changes. MJ

I think it depends on your position, and upon your circumstances. Selling at $41 might have been the right move for some and the wrong move for others.

We all expect a straight up move at some point, but nobody knows when that's going to happen. We also know enough to expect a few jaw-dropping blowoffs, based on the increasing volatility and the increasing uncertainty in this silver market.

We're seeing refugees from other capital markets entering the precious metals markets now. I tend to think that they are not all speculators, and that a fair number of them are going to be in it for the long haul because of the declining dollar and the condition of the real estate market. Throw the unfunded liabilities and debt problem into the mix and it's no mystery why more investors are starting to look in this direction.

The only reason I'd actually sell silver now would be to start tiptoeing into Bakken crude oil producers or GDXJ. Other than that, I still like platinum to balance out movements in silver vs. gold.

Justacommeman

Yes, my ratio was getting out of hand withs silvers out performance of gold.

PH, a lot I was able to trade without premium. MJ

renman95

<< <i>Yes, my ratio was getting out of hand withs silvers out performance of gold.

PH, a lot I was able to trade without premium. MJ >>



Curious, what was your "getting out of hand" ratio? Just something to gauge by.

SmallTownCoins

I thought tis was interesting enough to share....
Look at The Roman Empire 12 : 1

•2007 – For the year, the gold-silver ratio averaged 51.
•1991 – When silver hit its lows, the ratio peaked at 100.
•1980 – At the time of the last great surge in gold and silver, the ratio stood at 17.
•End of 19th Century – The nearly universal, fixed ratio of 15 came to a close with the end of the bi-metallism era.
•Roman Empire – The ratio was set at 12.
•323 B.C. – The ratio stood at 12.5 upon the death of Alexander the Great.


just to add...,
In my collection I have the first 12 Caesars of Rome in Silver and One Gold Aureus of Tiberius...
12 : 1 How cool is that... Haaaaa

TheBigB

<< <i>just to add...,
In my collection I have the first 12 Caesars of Rome in Silver and One Gold Aureus of Tiberius...
12 : 1 How cool is that... Haaaaa >>



Interesting info and I raise you with my Alexander the Great silver drachm.

Justacommeman

<< <i>

<< <i>Yes, my ratio was getting out of hand withs silvers out performance of gold.

PH, a lot I was able to trade without premium. MJ >>



Curious, what was your "getting out of hand" ratio? Just something to gauge by. >>



Complicated to answer as silver is a spec trade for me and gold is insurance. Different ledgers in my head. I wrestle with this internally. To answer your question the best I can silver on a true net net basis got to over 50% to that of gold.

Others that I put into silver/gold I started them out at around 25/75 silver to gold in 2006 I recently suggested them to rebalance or take profits. Most were in at $14 silver and $665 gold.

I've been wrong before.

MJ

TheRegulator

My gut-feeling is that silver will be making some greater percent gains in the very near term. But my most recent purchase was gold. Previous purchases had all been silver, but with the recent incredible run in silver, silver seems much more prone to some steep drops. For some reason, I'm also concerned about price manipulation and future efforts to crash silver.

The slower and more steady climb in gold just seems more inviting right now.

TomB

I've purchased both silver and gold fairly consistently since 2005 or so and even though silver has been on a tear recently I have still brought gold into the stack as well. From my point of view, this is a form of diversification within the PMs.

derryb

Currently selling select physical silver and collector gold. Using funds to double down on AGQ. My stop kicked me out today at $315, looking for a nice drop (please) to get back in.

Overdate

At the moment I like silver mining ETF's better than silver itself. In general, over the past year gold miners have outperformed gold, but silver miners have lagged behind silver. I'm betting that they will catch up.

jmski52

I've purchased both silver and gold fairly consistently since 2005 or so and even though silver has been on a tear recently I have still brought gold into the stack as well. From my point of view, this is a form of diversification within the PMs.

Diversification within pms is a concept that I like alot. Throw a cash component into the mix when appropriate and you have a flexible position that is easy to maintain. While interest rates are so low, there is no penalty. That may not change significantly for quite some time.

Monitor the Real Interest Rate (90 day T-Bill Rate minus the inflation rate). As long as the Real Interest Rate is negative, precious metals are a no brainer.