BUY LOW – SELL HIGH – But investors do exactly the opposite

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The following article was written by Heinz Isler, an independent advisor to institutional investors.
Gold - Amex gold bugs index  since 1999

Gold - Barron's gold mining index since 1939 29.6.14

Gold - BMGI gold ratio 27.6.14

Gold - overbought-oversold 27.6.14
Every portfolio manager is telling his clients
to BUY low and SELL high. Unfortunately they
do exactly the opposite. One example,
they buy currently bonds when yields
are close to nothing and where the potential
of losses are extremely high. On top of it, some
of these bonds, especially sovereign bonds,
will face huge haircuts (reduction of the nominal
value) and some bonds are highly illiquid hence
to sell them is very diffult in a bad market.

Nobody wants to buy gold shares! But just have a
look at the attached charts. Any of these charts
are telling you that gold shares are very cheap and
badly oversold. The last chart show you the Barron’s
gold mining index. Here, a 30-year Reverse Head and
Shoulder Figure is getting formed, which could propel
gold mining shares to unbelievable levels in the future.

This is the time to start to BUY precious metal shares
with a view of 2 to 3 years. The rewards will be very high
although you have to give time in order that the potential
develops fully.

BUY LOW – SELL HIGH. This is the strategy of the successful
portfolio manager. Sure, you want to be one of them!
Having the right asset classes does matters.


Heinz Isler
Independent advisor to institutional investors

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