Friday, August 26, 2011
It Was Time to Hedge Our Gold Position
With Gold continuing its parabolic ascent, we made the decision this week to hedge 50% of our exposure to Gold ETFs owned in our no load mutual fund. We still believe the secular bull trend for the yellow metal remains intact but Gold is long overdue for a shorter term price correction downward. Silver experienced such a correction several months back.
It's never a bad idea to take some chips off the table and protect your profits when any particular investment has run very far, very fast. Knowing when to do this and how to do this is what separates a "good" professional money manager (hard to find) from the self-directed investor, who more often than not will do the exact opposite; buy high and sell low!