bodgittandscarper Posted June 18, 2022 Share Posted June 18, 2022 22 minutes ago, reddog said: £30k silver would look impressive, but not very portable! (Also I hate paying vat) I actually have a similar amount in silver, and you wouldn't believe the difference in volume. Partyl why I was so shocked at my initial foray into gold. Quote Link to comment Share on other sites More sharing options...
warpig Posted June 19, 2022 Share Posted June 19, 2022 Does anyone have a good lab scale and some Britannias? I've just weighed some Britannias and I'm curious if other's get the same discrepancy in weights. I suspect the discrepancy is due the weight of the impurities in the coins... but I would appreciate other people's opinions on this. For reference I recalibrated my FX-120i lab scale with an F1 check weight and the data below was identical before/after the recalibration. The weight listed here for 1987-2012 Gold Britannias is listed as 34.050g. https://en.wikipedia.org/wiki/Britannia_(coin) Quote Link to comment Share on other sites More sharing options...
warpig Posted June 19, 2022 Share Posted June 19, 2022 Quote Link to comment Share on other sites More sharing options...
Silverfinger Posted June 19, 2022 Share Posted June 19, 2022 5 hours ago, warpig said: It's interesting, and I have essentially only bought Britannias recently because they are the cheapest thing around. Quote Link to comment Share on other sites More sharing options...
Silverfinger Posted June 19, 2022 Share Posted June 19, 2022 On 04/06/2022 at 22:55, Crashley Banjo said: this forum has proven that nothing is guaranteed and that you shouldn’t put all your eggs in one basket Problem is that many people do not understand what is in their basket. Quote Link to comment Share on other sites More sharing options...
warpig Posted June 20, 2022 Share Posted June 20, 2022 (edited) 18 hours ago, Silverfinger said: It's interesting, and I have essentially only bought Britannias recently because they are the cheapest thing around. I've just spoken to a bullion dealer and he said the tolerances vary by year and mint, but they’re only concerned about 1/10th of a gram and only if the other characteristics are of concern. i.e. does the obverse/reverse relief look correct and does it pass the dimension and ping tests. I guess when you think about how they mix copper or silver with the gold (pre 2013 Britannias (22K gold)), they must do it by batch... i.e. they don't create the alloy on a per coin basis to then make the coin blanks. So there's no guarantee the copper and silver mix evenly with the gold before they make the blank. I guess some have more gold in them than others and conversely more copper/silver than others - hence the variance. Edited June 20, 2022 by warpig Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 21, 2022 Share Posted June 21, 2022 Im bearish on Gold short term, I actually think there will be selling in the market. Not actually by people taking a short pos, but P.M's, traders and funds scaling back holdings in line with their mandate. For example I have a £1M portfolio and Ive allocated 10% to precious metals. But now due to the equities sell off my (and lets just say for arguments sake im fully invested in equities for the other 90%) £900,000 equity holding is now worth 720k. (900*.8) If I keep a 100k precious metals holding im overweight To keep my precious metals holdings at 10% of total portfolio value I must scale it back so I remain correctly allocated. My 100k pos, is trimmed... Again no directional bias just portfolio management. Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 21, 2022 Share Posted June 21, 2022 (edited) On 6/20/2022 at 3:38 PM, warpig said: I've just spoken to a bullion dealer and he said the tolerances vary by year and mint, but they’re only concerned about 1/10th of a gram and only if the other characteristics are of concern. i.e. does the obverse/reverse relief look correct and does it pass the dimension and ping tests. So are the discrepancies infact manufacturing tolerances? My only other suggestion other than manu tol and calibration was dirt...? 🤷♂️ Edited June 21, 2022 by Data Dave Quote Link to comment Share on other sites More sharing options...
nero120 Posted June 21, 2022 Share Posted June 21, 2022 3 hours ago, Data Dave said: Im bearish on Gold short term, I actually think there will be selling in the market. Not actually by people taking a short pos, but P.M's, traders and funds scaling back holdings in line with their mandate. For example I have a £1M portfolio and Ive allocated 10% to precious metals. But now due to the equities sell off my (and lets just say for arguments sake im fully invested in equities for the other 90%) £900,000 equity holding is now worth 720k. (900*.8) If I keep a 100k precious metals holding im overweight To keep my precious metals holdings at 10% of total portfolio value I must scale it back so I remain correctly allocated. My 100k pos, is trimmed... Again no directional bias just portfolio management. How did you allocate 10% to precious metals. What do you actually own? When the tide goes out we learn who's been swimming naked... Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 21, 2022 Share Posted June 21, 2022 17 minutes ago, nero120 said: How did you allocate 10% to precious metals. No, no, not me, it was just an example scenario. 19 minutes ago, nero120 said: What do you actually own? When the tide goes out we learn who's been swimming naked... Absolutely, paper gold isn't gold. Have you invested in some physical gold, coins or bullion yourself? Quote Link to comment Share on other sites More sharing options...
PrincessNutNut Posted June 22, 2022 Share Posted June 22, 2022 15 hours ago, Data Dave said: Im bearish on Gold short term, I actually think there will be selling in the market. Not actually by people taking a short pos, but P.M's, traders and funds scaling back holdings in line with their mandate. For example I have a £1M portfolio and Ive allocated 10% to precious metals. But now due to the equities sell off my (and lets just say for arguments sake im fully invested in equities for the other 90%) £900,000 equity holding is now worth 720k. (900*.8) If I keep a 100k precious metals holding im overweight To keep my precious metals holdings at 10% of total portfolio value I must scale it back so I remain correctly allocated. My 100k pos, is trimmed... Again no directional bias just portfolio management. The tricky bit in this is that correlation between asset classes is quite high. Gold, so far, has done its job very well. But when liquidity is gone, people can't buy it either. Though I wonder whether any significant left-over liquidity after the crypto bust will flow there? If so, gold may still do relatively well. Personally, I don't think it's the time for classic portfolio management. It's much better to just not play than to try to manage your losses in a bear market. Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 22, 2022 Share Posted June 22, 2022 2 hours ago, PrincessNutNut said: Gold, so far, has done its job very well. Stellar YTD 2 hours ago, PrincessNutNut said: Though I wonder whether any significant left-over liquidity after the crypto bust will flow there? I wonder this myself, I think the answer is maybe a little but probably mostly not. It seems from the sentiment you're in one camp or the other. The Gold vs BTC still goes on. I don't get it myself, could have a allocation for both in a portfolio but...🤷♂️ 2 hours ago, PrincessNutNut said: It's much better to just not play than to try to manage your losses in a bear market. Probably right if your running with a long only mandate. But discretionary traders running a long/short book with this vol could be making a killing. Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 22, 2022 Share Posted June 22, 2022 The other 'pain' with GOLD in USD is FX moves....most people have probably done better from the cable move than increase in the price of gold... £1 on jan 1st 2022 bought $1.35 (ie £10k bought you $13500) lets say you bought $13,500 of gold $13,500 today is £11,014 (ex the +1.73% in the price of gold) I want to just isolate the FX gain on holding $13,500 of gold in Sterling terms.. So that's just over 10%! Whereas previously stated gold has only budged up 1.73% YTD. The win was the dollar not the gold. Hindsight eh Quote Link to comment Share on other sites More sharing options...
nero120 Posted June 22, 2022 Share Posted June 22, 2022 11 minutes ago, Data Dave said: Stellar YTD I wonder this myself, I think the answer is maybe a little but probably mostly not. It seems from the sentiment you're in one camp or the other. The Gold vs BTC still goes on. I don't get it myself, could have a allocation for both in a portfolio but...🤷♂️ Probably right if your running with a long only mandate. But discretionary traders running a long/short book with this vol could be making a killing. Again, you're showing that you simply do not understand the gold market. The gold price you see in that chart is not the price of gold! If I bought an average amount of gold futures contracts on the comex, say 50 contracts (look at minute chart of GC1, volume of 50 seems about average). Each contract is 100 ozs, so that's 5000 ozs (or 140 kgs!) of gold in total for my position. Now, if I went to a bullion dealer and told them I wanted 5000 ozs of gold, do you really believe that the price would be ~$1850/oz? There is bound to be a difference since the realistic supply of an extremely scarce metal is in reality far less than paper contracts leveraged at 100s to 1. You might see a more realistic price with an OTC contract on the LBMA but that is an opaque market and we do not know the prices being paid on that market for physical gold in quantity. So, the paper and physical markets are extremely different, and the gold price you show in the chart above is not the price of physical gold, merely paper being traded with no real connection to the metal. As the financial and economic situation worsens, the markets will diverge even more until finally physical gold will not be available for any price in the west as western currencies hyperinflate. I expect at this point, the comex price will still be around $1900/oz! Quote Link to comment Share on other sites More sharing options...
PrincessNutNut Posted June 22, 2022 Share Posted June 22, 2022 46 minutes ago, Data Dave said: I wonder this myself, I think the answer is maybe a little but probably mostly not. It seems from the sentiment you're in one camp or the other. The Gold vs BTC still goes on. I don't get it myself, could have a allocation for both in a portfolio but...🤷♂️ True, one doesn't exclude the other. I think it springs from investor profile. Those high conservatism and high risk-aversion prefer the shiny metal. Those on the other end of the spectrum prefer BTC. Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 22, 2022 Share Posted June 22, 2022 57 minutes ago, nero120 said: Again, you're showing that you simply do not understand the gold market. I think we might have got off on the wrong foot or you have maybe taken offence to something I have said. Although I cant see where; I assure you no offence was meant. Dave X Quote Link to comment Share on other sites More sharing options...
nero120 Posted June 22, 2022 Share Posted June 22, 2022 31 minutes ago, Data Dave said: I think we might have got off on the wrong foot or you have maybe taken offence to something I have said. Although I cant see where; I assure you no offence was meant. Dave X Not at all, it wasn't meant as an attack. You posted the YTD chart showing that the gold price has dropped despite rampant inflation, when in fact there is no price discovery in the western gold market since the market trades leveraged paper with no connection to physical gold! The paper markets will never reflect the true physical price since they are not a physical market. Since they are not a physical market, how do we know what the true price is? Perhaps people have been buying more physical gold since inflation kicked off (I very much expect they have), but that additional demand will not be reflected in the paper markets. Quote Link to comment Share on other sites More sharing options...
nero120 Posted June 22, 2022 Share Posted June 22, 2022 1 hour ago, PrincessNutNut said: True, one doesn't exclude the other. I think it springs from investor profile. Those high conservatism and high risk-aversion prefer the shiny metal. Those on the other end of the spectrum prefer BTC. Gold and BTC are not similar in any way at all, but certain vested interests have pushed this angle aggressively to present BTC as having fundamental value. It's pure rhetoric that cannot be backed up by facts. For crying out loud they don't even trade in correlation (perhaps negatively), yet BTC trades like a risk asset! People are dumb so hammering them with this rhetoric works unfortunately. Quote Link to comment Share on other sites More sharing options...
PrincessNutNut Posted June 22, 2022 Share Posted June 22, 2022 48 minutes ago, nero120 said: Gold and BTC are not similar in any way at all, but certain vested interests have pushed this angle aggressively to present BTC as having fundamental value. It's pure rhetoric that cannot be backed up by facts. For crying out loud they don't even trade in correlation (perhaps negatively), yet BTC trades like a risk asset! People are dumb so hammering them with this rhetoric works unfortunately. "You've got to do the research, then you'll understand". Or something like that. Quote Link to comment Share on other sites More sharing options...
markyh Posted June 22, 2022 Share Posted June 22, 2022 2 hours ago, nero120 said: Again, you're showing that you simply do not understand the gold market. The gold price you see in that chart is not the price of gold! If I bought an average amount of gold futures contracts on the comex, say 50 contracts (look at minute chart of GC1, volume of 50 seems about average). Each contract is 100 ozs, so that's 5000 ozs (or 140 kgs!) of gold in total for my position. Now, if I went to a bullion dealer and told them I wanted 5000 ozs of gold, do you really believe that the price would be ~$1850/oz? There is bound to be a difference since the realistic supply of an extremely scarce metal is in reality far less than paper contracts leveraged at 100s to 1. You might see a more realistic price with an OTC contract on the LBMA but that is an opaque market and we do not know the prices being paid on that market for physical gold in quantity. So, the paper and physical markets are extremely different, and the gold price you show in the chart above is not the price of physical gold, merely paper being traded with no real connection to the metal. As the financial and economic situation worsens, the markets will diverge even more until finally physical gold will not be available for any price in the west as western currencies hyperinflate. I expect at this point, the comex price will still be around $1900/oz! I have a Bullionvault account, still with some Gold dust in it from 2009. I i bought 100 ozs of gold from the i would get a spot price plus spread. If i pay a fee, they will make physical delivery. there fore the paper spot price is the Gold price. Quote Link to comment Share on other sites More sharing options...
warpig Posted June 22, 2022 Share Posted June 22, 2022 https://www.rt.com/business/557611-russia-golden-ruble-sanctions/ Quote Link to comment Share on other sites More sharing options...
warpig Posted June 22, 2022 Share Posted June 22, 2022 (edited) On 21/06/2022 at 17:45, Data Dave said: So are the discrepancies infact manufacturing tolerances? Yes it seems so. I would guess the tolerances are much better with 2013 Britannias as they've shifted from 22K to 24K gold. If someone has some and can weigh them with any level of precision, it would be interesting to compare. Edited June 22, 2022 by warpig Quote Link to comment Share on other sites More sharing options...
nero120 Posted June 22, 2022 Share Posted June 22, 2022 (edited) 8 hours ago, markyh said: I have a Bullionvault account, still with some Gold dust in it from 2009. I i bought 100 ozs of gold from the i would get a spot price plus spread. If i pay a fee, they will make physical delivery. there fore the paper spot price is the Gold price. If you bought around $600 then that's $60,000 or $80,000 in todays money averaging 2% inflation per year (yeah right). Gold certainly did it's job for you, since you could sell it today for three times what you bought it for. Regardless, whilst 100 ozs is a sizeable amount of gold for a regular person these days it's nowhere near significant compared to the average size of trades on comex. The example I gave above was that an average trade is equivalent to 5,000 ozs or 140 kgs of gold. Daily volume is around 250k contracts, or 25m ozs / 700,000 kgs! The open interest for the current month contract is 500,000 contracts, or 50m ozs / 1.4m kgs (for reference, annual mine supply is about 3,500 tonnes or ~3m kgs)!! AND THIS IS JUST ONE EXCHANGE OF MANY!! These numbers are staggering considering gold is one of the scarcest metals on the planet. Just imagine if the comex paper market was closed and the buyers on that exchange had to go to physical markets instead, you really believe that you could rock up and buy 140 kgs of physical gold for $1850 / oz?! Personally, I doubt it very much. Bullion vault is one market of many, i don't doubt they have the metal to back their trades, but their average trade size is tiny - they don't have the volume to move the entire gold market and besides, no one takes delivery anyway. On a wider point, gold is currently in hibernation. We are finally reaching the end of the secular credit cycle and people who hold gold do not do so to "track inflation", it is an insurance policy to see wealth through the transition from this system to the next one. Russia/Putin has been speaking very loudly recently about the next financial system so it appears that since the war started the gloves are well and truly off and the Russians are planning on hitting the west where it is weakest. They know we have no real way to bring down inflation without decimating what is left of our zombie economies and our adversaries will exploit this ruthlessly - it is after all exactly what we tried to do to them (and failed miserably). Western markets still believe in the central bank put, they do not believe easy money is over, nor have they priced in the staggeringly high inflation we are experiencing. They think things will "return to normal", but deep down we all know that is not going to happen since there are no western leaders willing or able to solve the fundamental issues driving our economic woes. Once markets finally realise that the noose will only get tighter and tighter and tighter then gold will come to life again, but no one knows exactly when that will be as it is a psychological barrier and not something that can be calculated. Edited June 22, 2022 by nero120 Quote Link to comment Share on other sites More sharing options...
Data Dave Posted June 23, 2022 Share Posted June 23, 2022 18 hours ago, nero120 said: Not at all, it wasn't meant as an attack Roger that, fwens then 😊 18 hours ago, nero120 said: You posted the YTD chart showing that the gold price has dropped No no, the graph shows the price of Gold was up 1.73% YTD. The blue line you are referring to then, is the SPX (SP500), which is down 22 odd % YTD. I was drawing a comparison between the performance of Gold vs the SP500. But mainly about USDvGBP and how holding gold was a great move YTD with the move in cable. Quote Link to comment Share on other sites More sharing options...
Jonesy74 Posted June 24, 2022 Share Posted June 24, 2022 On 22/06/2022 at 09:47, nero120 said: Gold and BTC are not similar in any way at all, but certain vested interests have pushed this angle aggressively to present BTC as having fundamental value. It's pure rhetoric that cannot be backed up by facts. For crying out loud they don't even trade in correlation (perhaps negatively), yet BTC trades like a risk asset! People are dumb so hammering them with this rhetoric works unfortunately. Durability, portability, divisibility, uniformity, limited supply, and acceptability. Yea, not similar *in any way* (I hold both, but am obviously underwhelmed with the performance of the gold through a financial crisis and covid) Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.