Friday File: Cheap Insurance and Expensive Silver

by Travis Johnson, Stock Gumshoe | April 17, 2020 5:37 pm

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Source URL: https://sgumdev.stockgumshoe.com/2020/04/friday-file-cheap-insurance-and-expensive-silver/


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kidd14
kidd14
2 years ago

I for one appreciate the time and detail you put into your thoughts on the market

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precisionvision
2 years ago
Reply to  kidd14

Agreed

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glbcpa1
2 years ago

I do believe you are spot on Travis, in your soothsaying process. A very good epistle analysis. However, in Feb-March pullback, gold really did not flourish as I thought it would have. So, in the next big pullback, it probably will not rise greatly again, and silver will probably drop into the single-digits. I fully recall the 1978-80 Jimmy Carter malaise-inflation, where gold went from approx $280 to $800 per oz., and silver with Hunt Bros trying to corner the market went up to $40 per oz. I now have realized the NVDA and Mollox final China approval benefit this week, and sold, and now mostly in cash and intend to hold until a big pullback. I may miss some upwardness, bur will risk that. Beware the Ides of March (15th) err I mean the Ides of April 22 and later. Big wind is a-coming. Just my opinion along with gleaning wisdom from your analysis. Thanks

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emarkable
emarkable
2 years ago

I see what you did there..

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Shaun
2 years ago

Hi Travis, great write up as usual. I have a quick gold related question ( if you could kindly endulge my very amateur and long winded thoughts. )
Regarding a royalty stock taking your favourite sandstorm as an example i’m struggling to understand why you would keep it in your portfolio long term if it doesn’t immediately inverse/ limit downside during a market crash (or at least pay any dividends).
The share price doesn’t appear to appreciate in a bull market anywhere near what most (particularly technology) stocks do. Taking a quick look at the chart in the recent sell off it went from roughly $7.5 at the end of feb to $3.88 at the march low (a similar price that you could have got it for in 2016) therefore worse than the overall market and a lot worse than the large technology stocks.
If it is likely that gold stocks are a winner in the months/years following a crash would it not be better to not own it at all in the good times making your money in higher growth stocks (taking profits along the way in cash) and then buy when a crash such as this happens just as everyone is selling everything to increase their cash position?
You could then hold the stock through any bear market until the gold rally (hopefully)starts so not missing out on the upside whilst limiting the underperformance in the good times. Does this makes sense? Or do you think growth is going to the come to the company regardless (when for example their future revenue streams such as hot maden come on board)?
Or more likely (as i frequently do) have i completley missed the full picture?

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Janey
Janey
2 years ago

Sorry if I missed it.. but how are you buying gold? GLD? and gold miners (NEM?)

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viktor69
2 years ago

Any thoughts on OR? It seems it can t go back up like SAND did after March 23rd…

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tracer24
tracer24
2 years ago

Travis—what do you think about PRU as an insurance holding—beaten down like the rest of them, but with a nice yield. One of the biggest fixed income houses and Loeb seems to be an activist trying to stir the pot as well.

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livfr3
livfr3
2 years ago

Great job as usual. Stock Gumshoe is the biggest bargain in financial commentary. Like you I’m intrigued by Fastly (FSLY). Would you share your thoughts on how you determine an appropriate price to pay for this stock? Thanks

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mhuckabee1
mhuckabee1
2 years ago

Great research Travis! I am concerned about gold and other precious metals that don’t have a lot of intrinsic (i.e. industrial) value. Much like Bitcoin the price of gold is primarily controlled by what people think it should be not what value it has to a manufacturer. I am expecting some very tough economic times ahead and luxury goods probably won’t fare well. Marc Andreesen just wrote a great piece on building for tomorrow that is shaping my thinking towards those types of investments instead. Thoughts?

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