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Tesco on the weekly chart. About to turn or continuing that downward trend? Could go either way from here or consolidate between 370 and 400 before deciding what to do next. Anything below 350 on fundamentals looks cheap to me.

 

 

Thanks for that No6. So many things look interesting right now, decisions decisions.

 

 

 

Out of interest anyone here got any opinions on Intel / Microsoft or any of the other cash rich US blue chip tech stocks.

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Thanks for that No6. So many things look interesting right now, decisions decisions.

 

 

It might be worth holding off on any longer term decisions until this market decides what is likely to happen going forward. I'm not sure the market itself has a clue about what is likely to happen. It reminds me of the baby in a pram throwing its toys out when it doesn't get what it wants or attention. The baby itself more often than not doesn't know what it is raging about but seeks attention which usually the parents end up giving. Market = baby, Parents = Government + Central banks. Market stirs things up, do what we want or we will throw the toys out - falling share prices - and shout and scream until we get what we want. What do they want? Massive financial guarantees from the EEC that it will prop everything up at any cost including market losses? Massive financial guarantees on the system while calling for austerity for ordinary folk? Massive cuts in Government spending while those same Governments give massive financial guarantees to the financial system? And finally they complain about lack of growth going forward, but no one is convinced the private sector can pick up the slack if Government and central banks step back. Oh, and that private sector needs help from banks that don't really want to lend. So the market response is? Hit banking shares hard! Oh what a tangled web....

 

I've just about heard every excuse going to justify market falls in the last two weeks and I am convinced they haven't got a clue what they want.

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I've just about heard every excuse going to justify market falls in the last two weeks and I am convinced they haven't got a clue what they want.

 

I still think they want a Eurobond and that they won’t rest until they get it (or at least a solid commitment that they will).

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Out of interest anyone here got any opinions on Intel / Microsoft or any of the other cash rich US blue chip tech stocks.

 

Both are 'world dominators'. Buy and hold forever stocks that absolutely dominate their industries.

 

Intel totally doms its industry. Amd etc can't get close.

 

Msoft can't go bust. Even if it never sold another operating system or piece of software again. It could buy back all its stocks, pay off it's short term debt (approx 6 bill) and still continue to pay its divi.

 

It has 50 billion plus US dollar stockpiles, and about 1000 tons of silver and xxx amount of gold.

 

Good Luck (typed from the beach in cornwall)

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As of right now, 55 FTSE 100 companies are listed as paying a dividend of 3% or more. At a time when IR's are at an all time low, when savings rates for the most part are less than 2%, it is amazing that markets are falling so heavily giving that many companies seem to be rolling in cash and paying large amounts back to shareholders. What level of recession, double dip, etc, does the market seem to fear that would affect these dividend payers? Clearly not all of the 55 companies listed are offering safe dividend yields, anyone buying in needs to be careful of the future prospects, but I cannot recall a time in the past when yields were so high or companies so flush with cash just prior to a massive fall in share prices. Yet when you look at some of the technicals right now, MA death crosses, break downs on the longer term charts, etc, either this market has got it very wrong or they are gambling on the world economy falling off a cliff.

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I still think they want a Eurobond and that they won’t rest until they get it (or at least a solid commitment that they will).

 

Not sure Germany, the lender of last resort it would seem, would be up for that. Not sure Germany, even as the lender of last resort, is big enough to give the markets what they want either.

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Not sure Germany, the lender of last resort it would seem, would be up for that. Not sure Germany, even as the lender of last resort, is big enough to give the markets what they want either.

 

They are fighting it so far, mainly due to their voters current opposition. But that opposition might well change if it looks like everything is going to hell again (and looking forward, it really isn’t looking good right now).

 

I really see only two options going forward, euro-breakup or euro-bond (no pun intended :rolleyes: )

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They are fighting it so far, mainly due to their voters current opposition. But that opposition might well change if it looks like everything is going to hell again (and looking forward, it really isn’t looking good right now).

 

I really see only two options going forward, euro-breakup or euro-bond (no pun intended :rolleyes: )

 

It's an interesting one. At what stage does the EU decide that euro policy is decided by the markets or not? At times it is almost like some in the market have decided they don't like the euro so let's go after it to get rid of it. Reminds me a little of the old "run on the pound" that use to happen when the markets didn't like Government policy in the UK (usually old Labour type Government's). Someone might eventually ask who actually elects these money markets? No one, but that is where the real power lies, forget your little x on a ballot paper every 4 or 5 years.

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This is what Nadeem Walayat wrote earlier this week. He has been mostly right re the stock market in the last 4 years or so and it somewhat adds to my dividend yield points above.

 

Stock Market inflation Mega-trend Investing

 

Stocks of rising divided companies are one of the best long-term inflation mega-trend hedges therefore oscillations around the general stock indices growth spiral should be utilised to both bank profits and accumulate into which means bear markets and market panic events are buying opportunities. Yes, EVERY CRASH and BEAR MARKET without exception has been a buying opportunity for stocks in consistently raising dividends because they hedge your cash against inflation, because deflation does not exist in our fiat currency money printing world.

 

This is how I invest and grow my stocks portfolio, bank profits when the yields drop, accumulate stocks when the yields rise, a simple yet effective strategy where the yield is far more important than the stock price, because that is what will generate the return and DRIVE the stock price higher over the long-run.

 

So all I saw this past week was a summer discount sale of as much as 15% on the indices, though the reality is that solid dividend stocks are not only a hedge against the Inflation Mega-trend but also against market panics, which means I was lucky if I was able to secure a discount of 8%, let alone 15% on target stocks, which matches my previous long-term study of such companies that on average can be expected to fall at half the rate of the general stock market indices during market panics and bear markets followed by greater upside on the other side as a consequence of consistently rising earnings and therefore much lower P/E Ratios.

 

There are countless such dividend stocks such as Tesco, BHP, Vodafone, BATS, Coca Cola, HSBC, Glaxo, Royal Dutch Shell to name just a few. Key metrics to look for are consistent high dividend payers / raisers, good dividend cover and a low P/E.

 

So, if you get your investing mindset right (psychology) then market panic events such as last week are not times to panic, but rather a time to stock up on higher yields courtesy of lower stock prices of between 5% to 15% compared to where they were barely a few weeks go. Always Keep Yield in Mind, for you only need to know price if you intend on SELLING, after all when you put money in fixed rate savings account / bond do you ever consider the exchange rate of your domestic currency ? No you consider the yield, which is how you should also approach stock market investing.

 

Now before you run off and buy dividend stocks do remember that investing in the stock market is high risk and for the long-term, if you cannot acknowledge these fundamental facts of stock market investing and are prone to start sweating on every market dip then you should not be considering investing in even safe high dividend yield stocks let alone big name tek stocks that the mainstream media obsesses over.

 

Look, even if worse comes to the worst and stocks fall say another 20% by the end of the year, that translates into a 10% risk for dividend stocks ( an opportunity to accumulate more at an even higher yield), against which you are hedging against the long-run impact of the Inflation Mega-trend that looks set to deliver year on year rising dividend income ultimately matched by rising stock prices as a consequence of falling P/E's. Though my expectations remain for general stock market indices such as the Dow to make NEW bull market highs by year end.

 

And don't forget than there is a literal avalanche of scared money sat in the likes of U.S., UK and German bond markets, all it would take is a little stability in the economic data for stocks to spike significantly higher.

 

http://www.marketoracle.co.uk/Article29886.html

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Both are 'world dominators'. Buy and hold forever stocks that absolutely dominate their industries.

 

Intel totally doms its industry. Amd etc can't get close.

 

Msoft can't go bust. Even if it never sold another operating system or piece of software again. It could buy back all its stocks, pay off it's short term debt (approx 6 bill) and still continue to pay its divi.

 

It has 50 billion plus US dollar stockpiles, and about 1000 tons of silver and xxx amount of gold.

 

Good Luck (typed from the beach in cornwall)

 

Safest US stocks? Here's one view.

 

The World's Safest Dividend-Paying Stocks

 

By Brett Eversole, analyst, True Wealth Systems

 

Saturday, August 13, 2011

 

The last three weeks have been among the worst ever on Wall Street...

 

Which investments held up the best? After such a dramatic selloff, which companies should you buy now?

 

Let's take a quick look at the selloff and its best performers to find out...

 

Between July 22 and August 8, the S&P 500 fell nearly 17%. This was one of the worst 11-day periods in stock market history. We've seen crashes this bad just five times since 1946.

 

After such a historic crash – where companies like Bank of America (America's biggest bank) and U.S. Steel (America's biggest steelmaker) fell as much as 35% – it's important to know which companies barely budged during the crisis. We know these are some of the safest companies in the world.

 

Yesterday, I screened the S&P 500 to find the best performers between July 22 and August 8. The table below shows the results...

 

====================

 

There's an important idea in this list... one we've written about many times in DailyWealth. The idea is to own the best dividend-paying businesses in the world... ones that sell products that never go out of style, no matter what the economy is doing.

 

Companies like Coke (soda), General Mills (cereal), Pepsico (chips and soda), Kraft (food), Colgate (toothpaste), Mead Johnson (formula), and Altria (cigarettes) sell the "basics." And they held up well during the crash.

 

Think of them as beach houses that held steady during a hurricane... while most homes were devastated.

 

The strength these companies showed is no fluke, either. During the 2008-2009 recession, Pepsico, Coca-Cola, and General Mills, for example, all grew revenue and net income. They grew earnings per share by an average 17.6%. The ability to grow through one of the worst recessions in history is a huge mark of stability.

 

And on top of that growth, their share prices "only" fell an average of 26% during the housing bust and financial crisis. This is just over half of the 48% decline we saw in the S&P 500...

 

http://www.dailywealth.com/1812/The-World-s-Safest-Dividend-Paying-Stocks

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It might be worth holding off on any longer term decisions until this market decides what is likely to happen going forward. I'm not sure the market itself has a clue about what is likely to happen. It reminds me of the baby in a pram throwing its toys out when it doesn't get what it wants or attention. The baby itself more often than not doesn't know what it is raging about but seeks attention which usually the parents end up giving. Market = baby, Parents = Government + Central banks. Market stirs things up, do what we want or we will throw the toys out - falling share prices - and shout and scream until we get what we want. What do they want? Massive financial guarantees from the EEC that it will prop everything up at any cost including market losses? Massive financial guarantees on the system while calling for austerity for ordinary folk? Massive cuts in Government spending while those same Governments give massive financial guarantees to the financial system? And finally they complain about lack of growth going forward, but no one is convinced the private sector can pick up the slack if Government and central banks step back. Oh, and that private sector needs help from banks that don't really want to lend. So the market response is? Hit banking shares hard! Oh what a tangled web....

 

I've just about heard every excuse going to justify market falls in the last two weeks and I am convinced they haven't got a clue what they want.

 

 

 

Thanks for that. To my mind the market is behaving like a badly treated client that wants to take his business elsewhere but is stuck in a long term contract that it cant get out of. The Politicians are the salespeople as its their job to maintain a stable system and represent the Countries that are flogging their debt to the markets. The markets but the debt and so are the client. OK the stock and Gov debt are different markets but they think alike. After Bernanke stuck his Fed printer out to help restore the markets confidence a couple of years ago, politicians on both sides of the Atlantic now insist on pushing things down to the wire. Hence the p@@d off client that is growling at every noise the salesman makes! Having seen things forced down to the wire the client wants a solution that will avoid a repeat of the situation in six months time and does not see one!

 

 

 

Interesting comments from Soros a few days ago (in English) well worth reading.

 

 

 

http://www.spiegel.de/international/europe/0,1518,780189,00.html

 

 

 

Soros: The indebtedness of the US is not all that high, but if a double-dip recession was in doubt a few weeks ago, it is less in doubt now, because financial markets have a very safe way of predicting the future. They cause it. And the markets have decided that America is going to see a recession, particularly after the recent downgrade of the US by the rating agency Standard & Poor's.

 

 

 

 

 

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No.6, thank you. An excellent thread, particularly for someone like myself, who is still learning the basics of the market...and for that, your commentary is truly appreciated. I just knowcked up a thread on the main board asking for ideas re stock picks as im trying to speculate with my travel fund..I had not seen this thread at the time.

 

Im going to take time to re-read properly over the weekend.

 

Interesting that you mention Aviva and Petrofac....these are two that im looking at.

 

Cheers

 

 

BM

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What's the chances of dividends getting suspended if things turn bad, BP springs to mind but that wasn't down to the economy and was already priced into the share price. Shares like Tesco would be ok as people always need to eat, although customers might switch to Aldi etc.

 

I notice BAE is at multi year lows.

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Interesting that you mention Aviva and Petrofac....these are two that im looking at.

 

Cheers

 

 

BM

 

I've been in and out of Aviva several times over the last few years (3 times this week!).

 

I like them (great dividend etc), but they do have some exposure to EU, though I'm not sure how much at present.

 

They are on my list of favourites, but not sure if I would label them as rock solid safe.

 

PS yes, great thread No.6 (I had neglected this thread for quite a while as I had reset my browser to look at the main board).

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Both are 'world dominators'. Buy and hold forever stocks that absolutely dominate their industries.

 

Thanks for that, not quite sure if it was meant in jest.

 

Well Apple is now worth more than ALL the EU banks ! Not quite sure what that means either. Is Apple is over hyped or banks are over sold. Not sure that 1+1 =2 here !

 

http://ftalphaville....e-grande-apple/

 

 

+ Apparently on Twitter Alan Sugar has admitted to buying the banks recently (whoops) and has now sacked his brokers WENO F HALL & Co :lol: :lol:

 

http://www.telegraph...l#disqus_thread

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What's the chances of dividends getting suspended if things turn bad, BP springs to mind but that wasn't down to the economy and was already priced into the share price. Shares like Tesco would be ok as people always need to eat, although customers might switch to Aldi etc.

 

I notice BAE is at multi year lows.

BP was a very special case, for others the economic downturn would need to be really big to knock their dividend paying policy. The FTSE 100 is made up of many companies that to a large degree rely on overseas earnings, so it would take a world recession or depression to hit them. Not impossible, but short of another major banking crisis I think this is unlikely. I posted something earlier of US companies that continued to do well even after the turndown of 2007/8. For some of the FTSE 100 dividend payers even if they halve their dividend it's still more than saving cash with a bank. Your capital is clearly at risk with a share, but if you don't need it for 15-20 years a policy of buying the dividend payers on the dips is potentially a good one for all buy and hold investors (see post re Nadeem Walayat).

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I've been in and out of Aviva several times over the last few years (3 times this week!).

 

I like them (great dividend etc), but they do have some exposure to EU, though I'm not sure how much at present.

 

They are on my list of favourites, but not sure if I would label them as rock solid safe.

 

PS yes, great thread No.6 (I had neglected this thread for quite a while as I had reset my browser to look at the main board).

 

Aviva is an interesting one. I assume the share price is depressed because it is in the insurance sector, which appears to be unpopular at the moment, and it has a large pile of debt. Making tons of money though. If it cuts that debt pile as planned then I think it is dirt cheap. Div yield currently around 7%.

 

Aviva plans to cut debt by £700m

 

21 Jan 2011

 

Aviva has unveiled plans to cut its hybrid debt by £700m over the next three years in a move designed to bolster its modest share performance.

 

Britain's second-largest insurance group said it will pay down almost half of the £1.5bn in debt it needs to refinance during the period.

 

The company said it had also reduced the deficit on its defined-benefit pension scheme to £400m, from £1.7bn at the end of 2009. Last April, the company prompted anger from unions by ending final-salary benefits for 7,600 workers.

 

Thursday's changes were instigated by Pat Regan, Aviva's finance director, who replaced Philip Scott in 2009. Mr Regan confirmed the insurer would start to provide a more conventional measure of embedded value – an insurance industry measure of profits – rather than just disclosing market consistent embedded value, a version investors and analysts have warned is too confusing.

 

Aviva hopes the latest round of balance sheet restructuring will enable it to generate more cash. The insurer also hopes to improve its share price, which on Thursday closed down 0.2 at 428.1p. Aviva's market capitalisation stands at just over £12bn, compared with rival Prudential's £17bn.

 

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/insurance/8272233/Aviva-plans-to-cut-debt-by-700m.html

 

Aviva’s operating profits for the first six months of 2011 rose 3 per cent from £691m in the first half of 2010 to £709m this year as the insurer gears up for automatic enrolment and the RDR.

 

The provider’s interim results show operating profits in the firm’s life and pensions business dropped from £463m last year to £462m this year.

 

However, last year’s figure was skewed upwards by a one-off benefit of £84m after Aviva decided to reattribute its inherited estate in 2009.

 

If the impact of this payment is excluded, total UK operating profits were up 17 per cent compared to the first half of 2010 and life and pensions profits increased 22 per cent.

 

Aviva Group chief executive Andrew Moss says: “This has been a successful six months. We are beating all our operational targets.

 

“Operating profits rose in the UK and have increased by 21 per cent in Europe despite tough economic conditions.”

 

Total life and pensions sales increased 5 per cent from £5.19bn in the first half of 2010 to £5.47bn this year, while total pension sales were up 33 per cent from £2.06bn to £2.74bn.

 

http://www.moneymarketing.co.uk/pensions/aviva-uk-profits-up-3-per-cent/1035709.article

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No.6, thank you. An excellent thread, particularly for someone like myself, who is still learning the basics of the market...and for that, your commentary is truly appreciated. I just knowcked up a thread on the main board asking for ideas re stock picks as im trying to speculate with my travel fund..I had not seen this thread at the time.

 

Im going to take time to re-read properly over the weekend.

 

Interesting that you mention Aviva and Petrofac....these are two that im looking at.

 

Cheers

 

 

BM

 

I don't go to the main board much anymore, the aliens may abduct me. :lol: You are welcome to join in here.

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I don't go to the main board much anymore, the aliens may abduct me. :lol: You are welcome to join in here.

 

:lol:

 

Shhh! They'll hear you :ph34r:

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So, how undervalued might some companies be? Have HP got this one woefully wrong compared to the market price of two days ago? Why are companies prepared to spend this much over the market price if markets are going south? Autonomy isn't a small tech company, it is FTSE100.

 

Autonomy shares soar as £7bn HP offer hints at bidding war

 

Shares in Autonomy soared by more than 70 per cent yesterday after the surprise news that it had accepted a £7bn takeover offer from Hewlett-Packard. Analysts believe that, despite the "very generous offer", a bidding war could break out.

 

The Cambridge-based company, which specialises in software that tracks voice calls and emails, confirmed it was in bid talks with HP on Thursday evening after the markets closed.

 

The stock was the only FTSE 100 member to make it into positive territory yesterday morning as it stormed up from 1,546p to hit the 2,550p-per-share cash offer price, although it closed at 2,452p.

 

Gerardus Vos, an analyst at Investec, said: "We see this deal as HP playing catch-up in the 'big-data' arena, where we have seen a rapid consolidation by IBM, Oracle, EMC and Adobe."

 

Despite the bid's 80 per cent premium to Autonomy's closing price the previous night, Mr Vos predicted that a counter-bid could emerge because Autonomy "has one of the strongest intellectual property sets in enterprise information management and this would be difficult to replicate for other 'big-data' players".

 

http://www.independent.co.uk/news/business/news/autonomy-shares-soar-as-1637bn-hp-offer-hints-at-bidding-war-2340951.html

 

http://www.digitallook.com/security.cgi?csi=24851&username=&ac=

 

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It would be interesting to know if the punters are making or loosing money in these markets

 

http://www.google.com/hostednews/ukpress/article/ALeqM5hKLrArAQrnivjGhxcdcYwliUFdJw?docId=N0525741314019182618A

 

 

 

Spread bet firm IG Group has seen record levels of activity in the past few weeks as stock markets, shares and commodities have swung wildly.

 

The group, whose customers bet on which way markets, share prices and commodity prices will move, said the trading boom was despite it being the holiday season in most countries where it operates.

 

The frenetic trading has sent revenues in excess of £94 million for the quarter ending August, 19% higher than the £79.1 million generated in the same period a year ago.

 

The market rollercoaster over the past month has been driven by fear over the impact of the eurozone debt crisis and the possibility of the US economy grinding to a halt.

 

Costs have been kept in line with expectations, while the group is also keeping a tight rein on its customers who bet the wrong way.

 

IG said its credit management processes have proved robust and bad debts for the quarter will be less than 1% of revenues despite the rapid swings up and down.

 

European authorities have banned short-selling of financial stocks in France, Italy, Spain and Belgium for 15 days to try to calm the activity, but markets remain very nervous with rumours continuing to drive sentiment.

 

Commodity prices have also been very active, also good news for IG and other spread bet firms.

 

Gold hit a new all-time high recently of over 1880 dollars per ounce, while oil has been weak due to fears over the global economic outlook.

 

IG shares jumped 5% to value the group at £1.5 billion. Broker Investec Securities said in a note that the figures were "comfortably ahead" its expectations.

 

 

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So, how undervalued might some companies be? Have HP got this one woefully wrong compared to the market price of two days ago? Why are companies prepared to spend this much over the market price if markets are going south? Autonomy isn't a small tech company, it is FTSE100.

 

Well on one hand you have the fact that US markets rate tech stocks much higher and buyers also have to pay a premium.

 

On the other HP's bid shows they have some faith that business spending is not going to fall off a cliff. Although maybe Autonomy's product is maybe a "must have" rather than a "nice to have" for its clients.

 

I guess the thing is its the size of the premium that stands out. Must wonder if HP have been negotiating with Autonomy before the market drop - wouldnt be surpised and the figure was kind of agreed so they stuch to it. Similar situation 2007-8 with NCipher and ICI I remember.

 

Hmm what re ARM Holdings or even SAGE ? I see Sage got outbid on its Ozzie idea.

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Spread bet firm IG Group has seen record levels of activity in the past few weeks as stock markets, shares and commodities have swung wildly.

 

IG must love these markets, the volatility will scare punters into selling as much as greed entices them in. Perfect storm for IG I suspect. Heard at least 2 tales of margined out players cursing their spreads.

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IG must love these markets, the volatility will scare punters into selling as much as greed entices them in. Perfect storm for IG I suspect. Heard at least 2 tales of margined out players cursing their spreads.

 

The share look cheap and are near the year low. Div Yield over 5%, quite high for something that would still be considered a growth share.

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What are the best gold/silver etf's for an ISA? What etf's or funds do members here use for gold/ISA purposes? I was thinking to list them here and keep an eye on performance. (Note; not really interested in any debate about the validity of such funds or the holding of physical as against buying an etf as all of this has been covered ad infinitum elsewhere).

 

5 Gold ETFs that will turbocharge your ISA!

 

1. ETFS Physical Gold (PHAU)

 

Did you know that you can buy gold and keep it in a SIPP or ISA?

 

ETFS Physical Gold (stock symbol PHAU) is traded just like a share, but each share in the ETF corresponds to a small amount of a real gold bar held in a bank vault. This ETF is priced in US dollars. There is a similar physical gold ETF that is priced in pounds sterling (PHGP).

 

2. ETFS Leveraged Gold (LBUL)

 

Leveraged ETFs use derivatives to boost the return from investments. The leveraged gold ETF from ETFS Securities tracks the price of gold by a factor of two. So if the gold price rises 1%, the ETF will increase in value by 2%. Of course the opposite is true!

 

Due to the risks involved, Leveraged ETFs are for experienced traders and investors.

3. ETFS Precious Metals (AIGP)

 

Gold is the best known of the precious metals, but it isn't the only one it is possible to invest in.

 

Other precious metals include silver, platinum and palladium. Like gold, all three of these other precious metals are used by the jewellery industry. They also have a wide range of uses in other industries.

 

4. ETFS Physical Swiss Gold (SGBS)

 

Switzerland is a stable democracy. It doesn't participate in wars. The Swiss build their cuckoo clocks and look after rich people's wealth. It sounds like a good place to store wealth.

 

ETFS Securities now has a gold ETF that invests in gold bars that are held in Swiss bank vaults within the Swiss city of Zurich. There are modest fees associated with holding gold through this ETF. Of course ETFs also attract charges when they are bought and sold.

5. ETFS Short Gold (SBUL)

 

Is gold in a bubble? If you think the gold price is too high then it's possible to get an inverse ETF. As the price of gold goes down, the ETF increases in value.

 

Short ETFs are risky - if the the price of the asset they are tracking soars then the value of the ETF will theoretically go to zero. Fortunately ETFs are less risky than spread betting since you can't lose more than your initial investment capital.

 

So these are various ways of investing in the gold price.

 

http://danpowers.hubpages.com/hub/5-Gold-ETFs-that-will-turbocharge-your-ISA

 

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