CEF (Sprott Gold & Silver Holdings): NEUTRAL for 1 Month
I own a long term position in CEF of 10% which I plan to add to. Looking for CEF to pullback in a possible scenario where equities sell off hard over the next month and a new high in the VIX. If CEF sells off along with equities in that scenario, that will be an extremely bullish setup for CEF and I plan to at least double my CEF position.
Lining up current time-frames with the 2008 crisis, one would NOT expect a significant pullback in gold in this stage (especially with the recent reported shortages in actual bullion): after its initial selloff with equities in 2008, gold rallied and sustained its rally (and even the gold miners bottomed end of October 2008, five months before the S&P bottom!). However, I see a 50-65% chance that this crisis will be much worse than 2008 and that we will see new highs in the VIX (unlike 2008) leading to panic selling of everything, including gold. Thus, I need to positioned to add substantially.
Apart from this possible new highs in the VIX scenario, I am very bullish on CEF.
Note: CEF and other Sprott instruments are a great way to own actual gold bullion: much better than GLD & SLV. This may be the crisis where owning actual gold and silver actually matters vs owning paper gold and silver.
Lining up current time-frames with the 2008 crisis, one would NOT expect a significant pullback in gold in this stage (especially with the recent reported shortages in actual bullion): after its initial selloff with equities in 2008, gold rallied and sustained its rally (and even the gold miners bottomed end of October 2008, five months before the S&P bottom!). However, I see a 50-65% chance that this crisis will be much worse than 2008 and that we will see new highs in the VIX (unlike 2008) leading to panic selling of everything, including gold. Thus, I need to positioned to add substantially.
Apart from this possible new highs in the VIX scenario, I am very bullish on CEF.
Note: CEF and other Sprott instruments are a great way to own actual gold bullion: much better than GLD & SLV. This may be the crisis where owning actual gold and silver actually matters vs owning paper gold and silver.