Where is the safe haven?
Whenever the U.S. markets have a significant negative move like what we saw on Friday (DJIA -2.22%, S&P 500 -2.46%), we are used to hearing that money is being allocated to “safe havens”, most notably the United States Treasuries. But with ten year treasury rates hovering around a percent and a half, parking your money there will lose you purchasing power to inflation, which is undoubtedly likely to accelerate as the lagged effects of the QE 1&2 programs are kicking in and as a potential QE 3 is on the horizon.
I frequently hear that the precious metals markets, most notably gold, is a safe haven during inflationary times, but I personally have a hard time believing that a brick of yellow metal will do me any good in the event of an economic collapse. Now I did see a recent sixty minutes story about the value of gold in India and how society is completely infatuated with gold ownership (I highly recommend watching this if you haven’t yet), I just do not see that in the information age that gold bars will be an effective form of currency, especially when society is moving towards having payment options through smart phones rather than plastic credit cards or bills. I have a hard time imagining people carrying around a backpack full of gold bars around to pay for their daily expenses.
I am curious about where people are putting their money for capital preservation purposes. Every market I look at, there are caveats that make the risk reward profile shift in favor of the risk side, and it is hard to find any type of yield, especially for the long term horizon. Some of the ideas I had recently were baskets of Asian currencies, Energy Exploration and production ETFs, among a few others. Where do you guys see a relative ‘safe haven’ looking 1-2 years forward?
I have a handful of high dividend stocks and REITs (I'm out of everything else at the moment aside from some bond funds making up my fixed income portion). They have held up very well, with all of them gaining a little over the last few months while the market has fallen.
Are they a safe haven like you are talking about? Absolutely not. But if you don't want to ditch all equity, I believe that the dividend space is a solid one to be at the moment.
For your time horizon, I would consider Mortgage Reits like NLY and AGNC. Check them out - they pay nice dividends (13.5% for NLY and 15.5% for AGNC) and do not follow the markets step for step in times of volatility. Of course there is some risk associated with them - however if Bernanke stay's true to his word and keeps rates low through 2014 (your 2 year time horizon) there shouldn't be a problem.
Oil?
Series I Savings Bonds.
A rated corp debt
Why are you allocating based on a 1-2 year time horizon?
If it is to meet a critical payment then you should keep "most" of the money set aside for this in cash in the same currency as the expenditure.
Randomness and the volatility over a 1-2 year time horizon will matter more in whether or not you meet your payments than any inflation effects. Cash has near zero price volatility in this case (assuming USD denominated payments).
I don't like gold much, but some other commodities are attractive. When the market goes to hell, people still need the basics. Agriculture, certain metals, and textile materials are all attractive.
Utilities are a good income play, as are high-yield corporates. I like that REIT idea too.
hey
what will a sheet of paper do for you in the event of an economic collapse?
yeah that's what i thought
kindling?
Selected South America government and corporate bonds, although yields are also down.
preferred stock. you can deff find solid companies with a 7%ish yield
Healthcare REITs Utility ETFs
I need a safe investment for the summer. (Originally Posted: 04/27/2008)
I am going to be working an internship this summer, so I will not have the time to manage a personal portfolio of any sort this summer. With that said, I'm studying abroad in London in the fall and I need a safe place to let about $4,000 sit for the summer. Does anybody have any advice? I was thinking a mutual fund would probably do just fine, but then I thought about maybe a 3 Mo T-Bill or even possibly an emerging markets ETF. I just cannot have this money waste away any longer in my savings account....
Vanguard balanced index fund.
just give it to me and i'll handle it
Munis is where it's at!
Thanks for the advice. Does anybody know anything about Zecco.com?? 10 free trades per month sounds great compared to Scott Trade's flat $7 fee, and cheaper fees for options too. Anybody use Zecco?
I use Zecco. I think it's great. PM me and I will give you a referral code, I think we will both get more free trades.
Whao... it's really cheaper.
Why haven't I heard of it? Gonna dump my whole SA $$ into it.
Zecco is nice, 10 free stock/ETF trades per month if you have a $2500+ balance. Options are $5ish. Pretty good MM sweep rates. (4%ish)
I would keep a Scottrade account open, since Zecco doesn't offer free streaming quotes. Also, their account balance and trade confirmation systems are a bit crappy, but other than that, well worth it to change to Zecco. Just make sure your bank doesn't have selected brokers that you have to use.
If you are going to sign up for Zecco, please use this link, which has my referral code:
http://friends.zecco.com/r/8249166c66de102b8555
[quote=randomwalk0909]If you are going to sign up for Zecco, please use this link, which has my referral code:
http://friends.zecco.com/r/8249166c66de102b8555[/quote]
I tried this link, but it still seems to be asking for a promotion code??? (but maybe this is not the code you were referring to??)
if anyone else wants to sign up, pm and i can give you the referral code too we both win
hm weird, the link should work
Are there any safe CDs? (Originally Posted: 10/19/2008)
I have no idea how the FDIC is doing these days and what is insured and what isn't. I'm looking to invest money in CDs. I was looking at the best rates I can get. Highest I saw was GMAC, but that seems a little rocky right now. I was going to go for ING, but they're not doing so well either. I'm obviously going to avoid buying indices until the market clears a little.
Any suggestions on where it would be safe to park my money for 9-ish months?
CDs are guaranteed up to $250,000. They are safe and if the government for some reason said they wouldn't honor the guarantee it wouldn't matter where you had your money because we would be done
does that include foreign banks like ing? or in that case should i go to gmac?
Recent Safe Havens for when the Market Takes a Hit (Originally Posted: 08/27/2015)
An interesting dynamic was at play in the market's most recent connection. Money wasn't following into bonds, gold, or oil - it was flowing into the Franc, Euro, and Yen. The markets have rebounded fast and furiously off the lows but it will be interesting to see if this flight to these currencies continues if China continues to dump treasuries and devalue the Yuan. It seems like everybody including the investment banks is investing and recommending stocks according the the stronger dollar theory but I am especially interested in the Yen here with a lot of uncertainty in the capital and forex markets about what China is going to do next and if the Fed is going to raise interesting rates. USDJPY is also sitting on an interesting technical level. Just some food for thought.
Wrote a fuck ton of PUTs
You wrote puts on what?
Safe haven currencies (Originally Posted: 08/14/2017)
....................................................................................................
CHF. I have buddies in Zurich who hook me up ;)
I think u will not find here what you are looking for
JPY
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