Daily Wealth

About the Author Daily Wealth

In a nutshell, our investment philosophy here at DailyWealth is this: Buy things of extraordinary value at a time when nobody else wants them. Then sell when people are willing to pay any price. You see, at DailyWealth, we believe most investors take way too much risk. So our mission is to show you how to avoid risky investments, and how to avoid what the average investor is doing. We believe that you can make a lot of money – and do it safely – by simply doing the opposite of what is most popular.

SPDR Gold Shares (GLD): Finally, Gold Is a Buy Again

I made a lot of enemies at the end of last July.

I was a keynote speaker at the Sprott Natural Resource Symposium in Vancouver. In a room full of gold bugs, I told the crowd that I had personally sold all my gold and gold stocks the day before the conference.

The attendees thought I was crazy. Apparently, selling gold or gold stocks is never “OK.”

However, I stand by my decision. As it turns out, my timing for selling gold was exactly right.

That speech at the end of July roughly coincided with the top in gold and gold stocks for 2016. Gold and gold stocks went straight down for the rest of the year.

Since gold peaked over the summer, people have been persistent asking me to tell them when is the opportune time to get back in on the gold market. Finally, the time has come: gold is a buy again. It was simply a matter of a patience game, waiting for the right timing to strike.

Let me explain:

Back in July, I told the crowd that I personally took my biggest position in gold and gold stocks – ever – in January 2016.

Gold stocks were more hated than they’d ever been, so I urged my True Wealth subscribers to buy them. We sold half of our position over the summer for a 95% gain.

Again, we got the timing exactly right. We bought near the bottom, and sold near the top.

So when people asked me to tell them when to get back in, I said I was waiting for investors to give up on gold. Yet, gold investors were incredibly stubborn. It took them many months to give up.

If you’ve been a DailyWealth reader for a while, you know what I look for. I want gold to be hated and in the start of an uptrend.

In the latest issue of my True Wealth newsletter, I told my subscribers:

We will be gold buyers when two things happen: 1) Gold becomes a bit more hated, and 2) the uptrend returns. That may take a few months.

Here we are at the beginning of 2017, and finally I see the signs we have been seeking: 1) Gold is no longer as loved as it was, and 2) we have the start of an uptrend.

We nailed the buy in early 2016. We nailed the sell in the summer of 2016. And now, here in early 2017, I’m declaring the coast finally clear.

If you’ve been waiting since this summer for my “permission” to buy gold, you did the right thing. Gold went nowhere but down for months.

However, things have changed in 2017. Accordingly, my opinion has to change.

  • Ken

    “SPDR Gold Shares (GLD): Finally, Gold Is a Buy Again”

    Speaking of this fund in particular, why is there a clause in the GLD prospectus that states GLD has no right to audit subcustodial gold holdings? Why would the organizations behind GLD forfeit this right and create this massive audit loophole? I haven’t heard of a single good reason for the existence of this loophole so far. In addition to the audit loophole, GLD claims to be fully backed by physical gold bullion but yet it refuses to give retail investors the right to redeem for any of these ‘claimed’ gold bullion. I’ve read about and verified a number of other red flags as well:

    “I remember CNBC’s Bob Pisani visiting GLD’s vault in a well documented segment. GLD’s administration arranged this visit to disprove everyone claiming that GLD’s gold did not exist. However, Mr. Pisani held up a gold bar with the following serial number – ZJ6752. This serial number did not appear on the most recent bar list during that time period. Cheviot Asset Management’s Ned Naylor-Leyland later found out that this “GLD” bar actually belonged to ETF Securities.”

    “Did anyone try calling the GLD hotline at 866▪320▪4053 in search of numerical details on GLD’s insurance? The prospectus vaguely states “The Custodian maintains insurance with regard to its business on such terms and conditions as it considers appropriate which does not cover the full amount of gold held in custody.” When I asked about how much of the gold was insured, the representative proceeded to act as if he didn’t know and said they were just the “marketing agent” for GLD. What kind of marketing agent would not know such basic information about a product they are marketing? It seems like they are deliberately hiding information from investors.”