True Financial

  • Home
  • My Prosperity Login
  • About
    • John Duncan – Fee Only financial planner
    • Fee for Service Financial Planning
    • Our Ideal Client
  • Advice
    • Benefits of Financial Planning
    • Cash Flow Management
    • Superannuation
      • What is Superannuation
      • What is a SMSF
      • Contributions Limits
    • Investments
      • Investment Philosophy
    • Insurance Advice
      • Insure The Stay-at-Home Parent
      • Income Protection Insurance
    • Retirement Planning
    • Estate Planning Advice
    • Business Advice
  • Articles
  • Video Library
  • Testimonials
You are here: Home / General / The Gold Smack

April 26, 2013 by John Duncan

The Gold Smack

It’s a question financial advisers are used to being asked, but I suspect it’s something many won’t be asked for a while – “why doesn’t your investment advice include gold?”

On the back of gold’s 15% fall in a month as it slides into the $1300s, it seems few investors will continue to ask the question they were asking at $1,600 and $1,800 an ounce.

The true believers are saying there’s a conspiracy afoot, with Goldman Sachs and global elites crashing the gold price for their own ends.

While others are saying the decline in gold is reflecting economic growth returning in the US and there will be no hyper-inflation stemming from endless central bank money printing.

The reason for the fall is open for debate, but now gold has taken a large dive those people who were so desperate to buy at each new high have some reflection to do.

They need to ask themselves what prompted their urgency to become gold bugs in the first place.

Firstly they need to remember gold is just an object.

It doesn’t produce anything, it has no projected earnings and therefore no expected return – there are no dividends, distributions or interest.

Investing in gold is more speculating than investing because you buy hoping the price will go up.

This hope has been fuelled because many experts (experts who often sell gold) told us we’d soon see rampant inflation, something which hasn’t come to fruition.

Unfortunately, when the price went up many investors were quickly clouded by recency bias, assuming what they’ve just seen happen will continue and then they feel the urge to buy in.

Then there was the alternative option to capitalise on the boom – gold mining shares.

At a quick glance at some of Australia’s biggest listed gold miners, Newcrest, Regis, Evolution and Perseus showed them down between 40-60% since their highs of last year.

This despite each having overwhelmingly positive broker recommendations.

Gold’s fall is not a conspiracy, just another reminder it’s not healthy to fall in love with an asset class or rush to buy one just because it’s suddenly gone up.

Filed Under: General

Keep up to Date

Powered by VMA-Emailer

Meet John Duncan

John Duncan - Financial Planner

Director for True Financial - John Duncan - Fee Only financial planner To receive the best financial planning advice you need the best financial planner. John Duncan is certainly in that category. John is a financial planner who is unique in not only his high level of knowledge and experience in financial planning but also in the amount of areas that John advises in. A Financial Planner with a strong Education background John is a Certified … Read More

Post Categories

  • Budget (5)
  • General (26)
  • Insurance (2)
  • Investment (14)
  • Property (5)
  • Superannuation (4)
  • Tax Tips (7)
  • Uncategorized (44)

Like us on Facebook

Recent Posts

  • Federal Budget 2022/23
  • The Historic Market Crash
  • How Much Do I Need To Retire?
  • 2021 Q3 September Quarter Review
  • The Blind Leading the Blind

Privacy Statement

See our Privacy Statement here

Keep up to Date

Powered by VMA-Emailer

True Financial is an Authorised Representative No. 428771 and Credit Representative No. 428873 of FYG Planners Pty Ltd, AFSL/ACL No. 224543. ABN 29 009 541 253

Contact Information: Address: 23 Errard St Kelvin Grove 4059 - Phone: (07) 3169 2570 - Email: admin@truefinancial.com.au - Web Design & SEO by: Visual Marketing

Information provided on this website is general in nature and does not constitute financial advice. True Financial Pty Ltd will endeavour to update the website as needed. However, information can change without notice and True Financial Pty Ltd does not guarantee the accuracy of information on the website, including information provided by third parties, at any particular time. Every effort has been made to ensure that the information provided is accurate. Individuals must not rely on this information to make a financial or investment decision. Before making any decision, we recommend you consult a financial planner to take into account your particular investment objectives, financial situation and individual needs.True Financial Pty Ltd does not give any warranty as to the accuracy, reliability or completeness of information which is contained in this website. Except insofar as any liability under statute cannot be excluded, True Financial Pty Ltd, its employees do not accept any liability for any error or omission on this web site or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by True Financial Pty Ltd. You may not alter or modify this information in any way, including the removal of this copyright notice.