BLOG

BLOG

By Terry J. Atzen 20 Aug, 2016

Weighing-In on Gold and Silver……..What’s the Real Truth

In the past few weeks, I have been amazed by the extreme range of predictions on the price of Gold and Silver (Harry Dent [ www.economyandmarkets.com ] says $750 and Jim Rickards [ www.silverdoctors.com/Jim-Rickards ] says $10,000), so I decided to weigh-in on the subject (without the predictions!).

Let me say first, that this is a great example of why I wrote my book and why I do the work that I do.

Pundits can, and do oftentimes confuse investors. This creates doubt and causes investors to ask, “Who do I believe? Who is correct? “What is the Truth?”, and as the result, end up doing nothing when their personal instincts say otherwise.

My work is about “What Is” – logical, simple and easy to understand.

As usual, my analysis begins with an index, in this case, the Index for each of the metals, then the respective ETFs as well as the Inverse ETFs for verification.

And, at the end of this blog, I will take a look at the Gold/Silver ratio that many folks like to monitor.

First, the Gold Index:

By Terry J. Atzen 02 Jun, 2016
OK, here is what I see.
By Terry J. Atzen 27 May, 2016

Update on Gold

Gold has been a “hot” topic in the media so I decided to check-in on the subject – showing you what is really happening.

First of all, the Gold Index: (If you click on each chart it will make them larger)

By Terry J. Atzen 18 May, 2016

Once again, stocks are at a critical level and investors need to be aware of where the stock market is and pay attention to their stock portfolios.

As you can see from the chart below of the S&P 500 Index, stocks made an amazing recovery from the 1820 level (twice this year) and ultimately reached the previous high made last year (at 2110).

Currently, the chart below of shows that prices are once again at a critical level as buyers and sellers continue their daily trading.

By Terry J. Atzen 17 Feb, 2016

At The Investment Compass we are all about The Law of Supply and Demand. There is no other concept an investor needs to know in order to become a successful investor.

The reason for our commitment to this Law is because supply and demand are the only economic forces that affect the price of anything.

The price of homes, automobiles, groceries – anything – and that includes stocks, bonds, commodities, mutual funds and any other investment vehicle is determined by the prevalence of either buyers or sellers. Nothing else matters.

Many would argue that the matter of pricing is way more complicated. They would prefer to believe that fundamental factors such as corporate earnings, company sales, PE ratios or even which political party is in power are the factors that determine prices. All of those factors are categorized as “noise” here at The Investment Compass.

Buyers and sellers determine prices – it is as simple as that. Furthermore, we don’t even have to know why they are buying or selling. we are only interested in the prevalence of one or the other – if buyers prevail, prices move higher, and prices move lower if sellers prevail.

So the good news for investors is that there is available to them a pictorial representation of supply and demand which allows us to see where there is supply and where there is demand for nearly any investment vehicle. This pictorial representation shows us whether buyers are prevalent or if sellers are prevalent.

This representation is technology that has been used for well over a century and it is called a Point-and-Figure chart.

Point-and-Figure charts are unique in that what is mostly seen are Xs and Os.

The Xs represent buyers and the Os represent sellers. When one sees a column of Xs, we know that there are more buyers than sellers. On the other hand, when we see a column of Os, we know sellers are dominating that investment.

Below is an example of a Point-and-Figure chart of a stock many investors are familiar with – Intel:

By Terry J. Atzen 12 Feb, 2016

One of the longest-lasting strategies taught yet today is the practice to Buy and Hold investments.

As an illustration of my beliefs on the subject, take a look below and observe the price history for the last decade and a half, of General Electric. GE is not only a component of the Dow Industrial Average, it is also in the S&P 500 Index.

It also happens to be a favorite amongst the Buy and Hold crowd.

It is true, I could have chosen a different company, however, GE allows me to make my point that it does “depends on what you buy and hold” which is what I’d like to emphasis in this article.

As you can see, the price of GE has had several major price swings.

More Posts
Share by: