I have divided my STR proceeds into a small porfolio

- Shares in two companies that I like (one mining, one German propert)

- Some gold with Goldmoney

- Merrill Lynch Gold and General unit trust

- Ruffer General unit trust

- Ruffer European unit trust

- Cash with ING @ 4.75%


Now a potential problem is unfolding. I have only recently sold and build up this portfolio in the last three weeks. The stockmarket is tanking. Whilst I am EXTREMELY happy to be relieved of my mortgage my concern is how to maximise my STR fund.

I am a busy person and do not have time for regular trading - shorting the FTSE etc. Nor do I really know how to go about it.

In many ways I am pleased that stock market is tanking, and I have gone out of my way to avoid UK and US companies and funds. But it looks like the DAX and the Nikkei will get caught up in the general malaise, despite the fact that their economies are not full of debt.

Any thoughts?

I believe we live in deflationary times and therefore cash will be king, outperforming any other asset class.

My position is 80% cash (GBP, Euro, CHF), 17% goldmoney and 3% gold mining shares.

Gold and mining shares are my hedge against

- hyperinflation (in case irresponsible central bankers expand the money supply out of control in an attempt to fight deflation)
- bank default
- systemic risk

I would not touch the stock and bond market with a barge pole. Most financial assets are still extremely overvalued and a huge, painful correction will eventually bring yields and earnings back in line with long term averages.

Good luck!

cgnao - Would you be willing to say what %ages in GBP / Euro / CHF?

Interesting,

Deflation may be just around the corner but there seems to be some inflation going on at the moment, particularly fuelled by the rising oil price and the excess liquidity that there is - now it seems that it is all going to slosh over into Japan and Germany - it has to go somewhere. My hope is that this will reflect in my portfolio.

One thing I may do is move some of my savings from growth based funds over to an income fund, which basically holds bonds and the like.

I certainly intend to keep plenty in cash and even to increase my goldmoney holdings if gold drops back down again and I am concerned that I may be a bit over exposed to equities, even though I am outside the UK and the US. I believe the Euro based economies will do better in the longer term because they are not full of debt.

Anyway, lets see.

Slightly off at a tangnet but what is a good account for CHF, I see plenty of Euro and USD accounts offshore, but hardly anything for the CHF without massive amounts being required.. any thoughts? I liked the look of Bank of Scotland, but no branches round here.

Had a look on the BoS website, no sign of a CHF account.

Citibank has one, but no interest. Can anyone suggest one that does pay, at least a little, interest?

http://www.lloydstsb.com.hk/product/deposit.html
http://www.lloydstsb.com.hk/rate/deposit.asp

Any that don't require so much money - I was going to put 1/3 of my savings (c. 10k) that way. (1/3 in shares ISAs, 1/3 in savings accounts).

If you have over 15k in your ING account - then I would suggest opening a Cahoot 'bonus savings account' they are offering 5.25% for the first 6 months of having such an account open.

Then after your 'bonus' 6 months are up, move the cash to ICICI Bank @ 5.10% (or Citibank at 5.10%, but I think you need 75k with them for that rate).

A question on the foreign exchange accounts - Am I correct in assuming to convert a substantial sum (say 25k) of GBP into CHF or CAD will incurr a conversion fee through just about any bank?

Is there anything to stop me converting £3,000 cash at a time with no fee at the post office, then depositing it in my Citibank account?

Other than getting a rubbish rate, then having a fair amount of difficulty putting the notes into the account itself, probably not.

Try xe.com for fx exchanges.