So it jumped.
Being correct about why it is up probably doesn't matter a lot in the context of a diversified portfolio.
I first wrote about gold on this site on October 29, 2004 and have been saying the same thing the entire time.
Some exposure to gold is always appropriate. It tends to zig when stocks zag. I think this is an important part of portfolio construction. Today is a microcosm of the effect.
2 comments:
Roger,
Time to rebalance Gold in a portfolio if it has gone beyond your targeted portion of a portfolio?
Jeff,
Good question. My only exposure for clients is GLD. It was in the neighborhood of 3% for most folks when I put the position on.
I had swapped Anglo Gold for GLD in Feb. AU had grown and I cut back just a little with the swap.
My price on GLD is in the $54's it is now in the $61's. The gain is around 11%. In the same time client portfolios are up a little too, not as much as GLD obviously.
Scaling back from here would not be cost effective and is probably unnecessary.
If gold were now 10% of my portfolio due to great stock picking and I wanted 5% I would do something in the way of an exit strategy, sell now, stop order, mental stop any proactive step would work.
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