The GoC challenge: how would you trade this market setup?

[Ghost of Cutten]

Quote from Daal:

The thing with these changes is that while usually its hard to be a good short-term market timer it should be even harder if there is a bull market going on and you want to fade it, particularly when we are talking about assets with long-term risk premiums

If we consider the premium as a 'commission bid/ask spread' type cost, then almost no sane person would trade it. Which is why one needs a HUGE reason to get smaller, like it needs to be really obvious, otherwise it pays to stay on it and earn the premium

That's a great point - being long investment assets in general (as long as they are not significantly overpriced) is a bit like being in a strong secular market/economic theme, you should be in unless there is a strong reason to be out. Rather than treating them like normal trading vehicles, or typical directionless/random markets like commodities or currencies, when you should stay out unless there is a strong reason to be in.

 

[sprstpd]

Update: I have replaced all my gold and silver that I sold. I was expecting more of a decline and didn't get to reload at tremendous prices. But oh well, saved a few percent. I am not sure it was worth the gut wrenching involved, but probably.

Knowing how the market usually works, its probably time for another dump now that I have on my full position.