Gold is such a pathetic hedge(or a non-hedge even)

bone said:
Oil is another lost soul. So much supply on the market that there is zero flight-to-quality bid. It's just an analog to the equity markets.
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There is a .0001% chance that within one calendar year, the energy grid will go down for an extended period of time (say, a few weeks) because of sabotage, solar flares, geomagnetic field disturbance, or just plain old Satan. If that happens, I think CL demand will rise a good deal.

Otherwise, I stare at the small energy portion of my portfolio and whimper. Hehe! Dividends? Whoopdie f-ing do.
 
ET180 said:
Gold mostly follows the dollar and yields. There is an opportunity cost to hold gold over something that pays interest. Today gold provided a partial hedge for equities.
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Agree, It is gonna take sometimes
 
trader99 said:
I have stopped trading gold a long time ago.
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If you're trading then Gold is just a number that goes up and down.

It's a pretty good speculation vehicle regardless of whether it's a hedge or not against this and that.

Many Gold traders in 2020 have made out like bandits. Fantastic moves both ways..

PS. It's unproven but some say having a One Ounce Gold coin on your desk increases overall trading profits...
 
trader99 said:
In these volatile and crazy times, one would think gold should be going up. But of course, it gets bitch slapped like every other asset classes.

Just an observation. I have stopped trading gold a long time ago.
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Instead of trading gold, why not just buy some and hold it. In 20 years time, your dollars are almost guaranteed to lose 90% of their purchasing power. Do you think gold will lose 90% of its purchasing power?
 
sprstpd said:
When central banks sell, it is time to buy gold. They'll buy it back from you at the top.
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Guess you missed this part:-

"Putting things in a bit of perspective, Q3's sales come following record purchases by central banks in 2018 and 2019."
 
What several seemingly astute macro analysts have said in the past year:

  • Gold is a hedge against negative real rates
  • Gold is not a reliable hedge to equity market risk
  • Gold appreciation comes during relatively short, high momo moves separated by long periods of hard-to-trade chop
Related:
  • During the periods/moments of the greatest stress on the entire financial system, the correlation of all assets approaches 1, including gold;
  • On margin calls, the over-leveraged get out of everything, including gold
Thus trading gold short-term is esp difficult

Also related, per Real Vision founder Raoul Pal: when bonds have near-zero rates, their volatility increases, and their reliability as a hedge to equity markets is much reduced. Look at the TLT chart from March during the worst of the equity meltdown.
 
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