Three sides to each coin
Gold has a density of 19.32 g/cm3, whereas Silver has a density of only 10.49 g/cm3. Thus, a 1 oz bar of Silver will be almost twice as large as a 1 oz bar of Gold. Considering that the ounce of Gold is about 72.38 times more valuable than Silver (the price of one ounce of Gold US$1,945 versus Silver US$26.87) makes from a size perspective (you need a pretty big personal safe to store some Silver) Gold the much more attractive long term wealth preservation instrument. But there are three sides to each coin.
When Gold and Silver prices will rise to much higher levels than right now, even small denomination Gold coins will be unsuitable for actual physical barter. And yes, we have seen historical times where actual barter is of much use. With Silver still being much undervalued also from a risk-reward perspective of the actual price increase, we find Silver should be one of the primary holdings of your overall wealth preservation portfolio. We mentioned in the past that Bitcoin even though in a much lower proportion, could as well be a sensible instrument to be held. This for long-distance value exchanges that could be necessary for an unstable future.
Gold/Silver-Ratio, Monthly Chart, Three Sides To Each Coin:
Gold-Silver-Ratio, monthly chart as of September 11th, 2020.
The monthly chart of the Gold/Silver-Ratio shows how Silver has partially caught up. We expect lower levels in the long term making Silver an attractive long term bet. Right now the ratio has found support above the 70 levels. It would come to no surprise if temporary gold would front-run Silver for a tiny little bit again. This and the cofactor that the 200 simple moving average below supporting temporary stability was warranting us to take partial profits on our recent Silver reload.
Silver, Weekly Chart, Worth Taking The Risk:
Silver in US-Dollar, weekly chart as of September 11th, 2020.
On the 8th of September, we posted in real-time a weekly long entry for Silver in our free telegram channel. The chart above shows that prices had declined into a fractal support zone that allowed for low-risk market participation. At the same time, we also initiated a Gold position which proved to be the stronger candidate. While Gold allowed for a handsome financing point (see our quad exit strategy), Silver was lagging. Consequently, we cut the position in half to lock in minimal profits but more importantly reduced capital exposure risk. Our focus at all times is less on maximizing profits but rather protecting our assets knowing there is plenty of fish in the sea and always another opportunity awaiting. However, this is true only for those who have assets to play the market though. If you don’t follow proper risk mitigation strategies and lose too much in one single trade or investment you cut yourself short of all this opportunities that constantly show up in the markets.
Silver, Daily Chart, Risk Control And Profit Taking:
Silver in US-Dollar, daily chart as of September 11th, 2020.
The daily chart illustrates how we again were able to take further profits on the 10th of September. Now we are comfortably left with 25% of our original position size for all eventualities of what the market might decide where the price is heading. The prior weekly chart shows how Silver is trading right at the point of control (the yellow line), which still proofs exposure worthwhile.
Three sides to each coin
It all comes down to risk and practicability.
For your short term trading, it is wise to be a specialist. Focus on fewer instruments and become consistent in profit extractions.
In the long term, a diversified approach is principle-based. The longer the investment horizon the harder to predict the future. There you want all three sides of your coins to be covered.
This might sound like a generalization but too often we see market participants throwing many eggs against the wall on small time frames hoping for something to stick. This is mainly due to a lack of a well-defined trading system. And they put all eggs in one basket when it comes to wealth preservation for the long term. But what if governments confiscate gold as they have in the past and that was your only nest egg. You could take a huge draw down. The scenario most to be avoided by any speculation approach.
Join our free Telegram Group :https://t.me/joinchat/HGe22hDDEEl0LvFGAgEZ9g
All published information represents the opinion and analysis of Mr Korbinian Koller & his partners, based on data available to him, at the time of writing. Mr. Koller’s opinions are his own and are not a recommendation or an offer to buy or sell securities. Mr. Koller is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations. As trading and investing in any financial markets may involve serious risk of loss, Mr. Koller recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.
Although a qualified and experienced stock market analyst, Korbinian Koller is not a Registered Securities Advisor. Therefore Mr. Koller’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction. Past results are not necessarily indicative of future results. The passing on and reproduction of this report, analysis or information within the membership area is only legal with a written permission of the author.
Important Trading Risks and Earnings Disclaimers - Terms of Use
RISK DISCLAIMER: All forms of trading carry a high level of risk so you should only speculate with money you can afford to lose. You can lose more than your initial deposit and stake. Please ensure your chosen method matches your investment objectives, familiarize yourself with the risks involved and if necessary seek independent advice.
U.S. Government Required Disclaimer - Commodity Futures Trading Commission. Trading financial instruments of any kind including options, futures and securities have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the options, futures and stock markets. Don't trade with money you can't afford to lose.
NFA and CTFC Required Disclaimers: Trading in the Foreign Exchange market is a challenging opportunity where above average returns are available for educated and experienced investors who are willing to take above average risk. However, before deciding to participate in Foreign Exchange (FX) trading, you should carefully consider your investment objectives, level of experience and risk appetite. Do not invest money you cannot afford to lose.
EARNINGS DISCLAIMER: EVERY EFFORT HAS BEEN MADE TO ACCURATELY REPRESENT THIS PRODUCT AND ITS POTENTIAL. THERE IS NO GUARANTEE THAT YOU WILL EARN ANY MONEY USING THE TECHNIQUES, IDEAS OR PRODUCTS PRESENTED. EXAMPLES PRESENTED ARE NOT TO BE INTERPRETED AS A PROMISE OR GUARANTEE OF EARNINGS.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAN ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
All information presented or any product purchased from this website is for educational and research purposes only and is not intended to provide financial advice. Any statement about profits or income, expressed or implied, does not represent a guarantee. This presentation is neither a solicitation nor an offer to Buy/Sell options, futures stocks or securities. No representation is being made that any information you receive will or is likely to achieve profits or losses similar to those discussed on this website. The past performance of any trading system or methodology is not necessarily indicative of future results. Please use common sense. Get the advice of a competent financial advisor before investing your money in any financial instrument.
Terms of Use: Your use of this educational website indicates your acceptance of these disclaimers. In addition, you agree to hold harmless the publisher and instructors personally and collectively for any losses of capital, if any, that may result from the use of the information. In other words, you must make your own decisions, be responsible for your own decisions and trade at your own risk.