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Discussion Starter #1
I am 20 and as such am new to investing and trading. About 18 months ago when Gold was in the $945 p/ounce region I put $2000 in gold leveraged 100:1. I didnt have a clue what I was doing but its what I did. I ended up making $64,000 when gold made its gargantuan spike.

I then backed out of trading, not becaues I lost big like most, but for the opposite reason, I was scared of my success. But now im considering the choppy waters of gold again.

Right now gold stands at a point that big profits can be made for the lucky investor who can make the right call because gold is either going to drop big, or continue to climb. I personally want to believe that the economy will pick up and stronger currency value will bring gold back below $1000 an ounce. However many signs point to gold growing even stronger in the future?


I appreciate the thoughts and critisisms of more seasoned investors in this matter.
 

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Lucky you, to win on that bet. If I were you I would take at least $50,000 of that and put in something safe like a GIC and don't touch it. You have now won $50,000 plus interest every year and it is safe and it is yours.

Most of the time when you make a bet like that you lose even if you are right because the bet takes the opposite direction and takes you out of the trade before you are right. I would look at this like you won the lottery and that is it.

As far as gold goes I do believe it is in a long term bull market but it could easily take a decline here as the US dollar is oversold.
 

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First and foremost congratulations. That is an impressive gain no doubt. But as previously mentioned, it was a smart bet, but lucky nevertheless.

You could do very well investing back in gold, but in the same token, you could crash and burn and your gold investments become a lot less than what you started with.

I personally believe that gold will continue its climb. It will dip again before it makes some more gains, but in the long run, gold will rule the day.

-The U.S. National Defecit is in the Trillions.
-Interests rates are as low as they can go. They were lowered to battle deflation, now in the coming months and years interests rates will have to be raised to fight inflation. Higher interests rates will hurt the US dollar.
-China now lends more money to the USA than any other country in the world.
-China has a ton of gold. And at least 1 trillion dollars worth of US currency sitting in its vaults.

You cannot continue to increase the money supply, cut interest rates and keep dishing out bailouts like the Easter bunny gives out chocolate. Its not sustainable.

There are only so many options that the USA has. As far as I know a country cannot declare bankruptcy. Eventually they will have to repay their creditors. You either do this by increasing taxes and or cutting services.

The trend is your friend as the saying goes. The US greenback used to be the standard for measuring currency the world over. Those days are long gone. Gold is the new standard and it will continue to do so, especially the lower the US dollar dips.

I am just relaying some facts and advice that I read elsewhere and I happen to agree with these points.

I would bank 50-55k or so and play around with the other 5-10k if you want too.
 

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Discussion Starter #5
Thanks for the congrats guys. Im very aware I was lucky, very aware, and very thankful, it could of gone alot worse. But it made me ask myself, do people ever get rich doing this? The most successful traders I know are the guys who only ever trade small ammounts and use things like RSI indexing. They never win big but they never loose big. Im just another impatient young person I guess, I try not to be, maybe I should invest until im older :)

Im going to University in 2010 and then lawschool. Ive put away the majority of my money towards that (instead of the BMW my gf wanted), an education is the best investment anyone can make. I grew up in a not-so-well-off family so getting the money to pay for post seconday has been almost impossible till now.
 

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I think that you should invest where no one else is investing. If two people are telling me to invest in something I don't want it :)

Gold is too hot right now.

Paying for your education is an awesome plan :)
 

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Alex, great plan, put your money towards your University education. If you can graduate from law school debt free, it'll give you a huge head start in your financial life.
 

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Congrats. Those successful traders you know are like a casino. By making many tiny bets and with a (perceived) >50% chance of a profitable trade, they grind out gains over time. You were wise to take your money off of the table.

I agree with others. Save it for your education. And learn about investing while you're still in school.

If you've got any left over that you're wanting to invest, I'd suggest looking into gold coins (the safest form of gold investment imo). Commodities are my forte and my investments have been heavily gold related for years now. Even at these prices I have about 6 bids on ebay right now for gold products because, as my name suggests, I believe gold's run has years to go.
 

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Discussion Starter #10
BG2011 i thank you for your advice. Gold is an appealing market to the young not because of the risk of loss, but the chance of gain, and more importantly fast gain. I agree with your assesment of gold coin, youve peaked my intrest to look into investing at least a portion of my capital into gold coin, what course of action would you recommend? Find gold coins and buy, or is there more too it than that (there always is)

Thank you for you time and council
 

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For gold coins there are several routes you could go.

In order of my preference:

Find an individual dealer with the best deal. There are some who will deal in cash and some who will sell at spot price. (spot price is the price you see on the news but you usually don't buy actual gold at that price) Once you find a good dealer, you never have to look elsewhere.

Ebay. There are cashback programs out there that will allow you to possibly get gold for below spot. The best one I've found for ebay is 3% cashback through Mr Rebates. If you live in the US, you can combine it with the Bing cashback program, which is 10% I believe. THe problem with this method is that you'll have to spend a bit of time looking for deals and then there's the bigger issue of counterfeits. You may want to ignore this option if you don't want to deal with the risk of fake gold.

Buying from a reputable dealer. You pay the most this way but at least you'll get the real deal. You can check the banks and you can check out online dealers. Everyone sells for a different premium so you can compare. Some online dealers that deliver to Canada:
kitco.com
bordergold.com
silvergoldbull.com
bullion.nwtmint.com

Extra tips:

Stick with the most popular coins as they will be easier to sell. These are the coins that show a currency value on them for their country of origin. I think the most popular in this category are Canadian maples, American Eagles, South African Krugerrands and Chinese Pandas.

Don't buy gold in bigger denominations than 1 oz. Again for selling reasons, the smaller the better. You will be charged a higher premium as you go down in size though.

Don't actively buy and sell your physical gold. That's a core holding that you have or you don't. If you want to trade gold, keep it in your brokerage account.

Good luck!
 
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