SIVR : Bought for about 5% of the total portfolio
Fundamentals
The Consumer Price Index (CPI) was released in the US on September 13th, 2023, and inflation is on the rise. Year-over-year (y/y) inflation, which had been decreasing month after month for a while and had almost reached 3% in July, has spiked up to 3.2% in August and 3.7% in September. This 3.7% figure is even higher than the forecasted value of 3.6%.
As a result, there is a higher probability that the Federal Reserve (FED) might increase the interest rate even further in the upcoming Federal Open Market Committee (FOMC) meeting scheduled for September 20th, 2023. I anticipate a rate hike of either 25 or 50 basis points, which would bring the Federal Funds Rate to either 5.75% or 6%, respectively.
This potential rate hike might lead to a crash in the overall stock market, and commodities, especially gold and silver, can be used as a hedge to protect the portfolio if this scenario materializes.
Technicals
From a technical standpoint, both gold and silver are currently at buying levels. However, when considering the potential upward move from a percentage point of view, silver appears to be a better alternative to gold.
Conclusion
Consequently, I have taken a position in a silver ETF, allocating 5% of my total capital. This is double the maximum I typically allocate for a single security. However, I have strong confidence in silver as a long-term investment, and I may consider adding more if its price further declines and reaches the next key buying levels.
I have attached posts regarding my previous trade in SIVR for your reference. Feel free to check them out as well.
The Consumer Price Index (CPI) was released in the US on September 13th, 2023, and inflation is on the rise. Year-over-year (y/y) inflation, which had been decreasing month after month for a while and had almost reached 3% in July, has spiked up to 3.2% in August and 3.7% in September. This 3.7% figure is even higher than the forecasted value of 3.6%.
As a result, there is a higher probability that the Federal Reserve (FED) might increase the interest rate even further in the upcoming Federal Open Market Committee (FOMC) meeting scheduled for September 20th, 2023. I anticipate a rate hike of either 25 or 50 basis points, which would bring the Federal Funds Rate to either 5.75% or 6%, respectively.
This potential rate hike might lead to a crash in the overall stock market, and commodities, especially gold and silver, can be used as a hedge to protect the portfolio if this scenario materializes.
Technicals
From a technical standpoint, both gold and silver are currently at buying levels. However, when considering the potential upward move from a percentage point of view, silver appears to be a better alternative to gold.
Conclusion
Consequently, I have taken a position in a silver ETF, allocating 5% of my total capital. This is double the maximum I typically allocate for a single security. However, I have strong confidence in silver as a long-term investment, and I may consider adding more if its price further declines and reaches the next key buying levels.
I have attached posts regarding my previous trade in SIVR for your reference. Feel free to check them out as well.
