🚨Why did I start accumulating gold in my portfolio?
In recent weeks I've become a bit more interested in gold. My target was the area around $4,000 per ounce, where I'd like to gradually build positions.
✌️The risk/reward ratio for gold is starting to improve – for indices, most of the optimism (AI, earnings, strong economy) is already priced in.
👉So why now? - It all comes down to bonds‼️
When the US 10-year yield approaches 4.6%, it's tough for gold – it carries no interest, no coupon. Opposing it is a bond that pays a decent yield in dollars.
Add a stronger dollar + fear of a second wave of inflation because of oil🛢️
People are therefore more willing to enter bonds than stocks, where they can get a decent 4.6% risk-free yield.
👉My thesis: the 10-year yield is near a local peak (~4.7%) and will gradually turn down, maybe to 4.25% - 4.15%
💰High yields themselves slow the economy – more expensive mortgages, pricier corporate debt, more cautious banks.
When real yields start to fall, gold will get some room✨
At the same time, I think there's room for gold to slip a bit. But will it keep falling in the future?
Personally, I don't think so. What do you think?
You won't reach anyone here with this until axes start falling and people who've never experienced a crisis begin to feel wet in their boxers 😂 — and that will only happen when they spend every last bit of cash buying the dip, which then ends up being the start of the fall. I've already bought in to balance a large position in semiconductors and I'm impatiently waiting to see them go through their annual test.