Welcome to our Friday mailbag edition!
Every week, we receive fantastic questions from your fellow readers. And every Friday, I answer as many as I can.
Before we get into today’s questions, I want to thank everyone who joined me for my very first strategy session of the year last night.
If you’ve been following my work, you’ll know I spend a lot of time in Washington.
Over the past 20 years since I quit Wall Street, I’ve spent countless hours working with our federal officials.
And where government money goes… the markets follow. So it pays to look closely at the legislation coming out of D.C.
And thanks to a law that just went into effect this month, I believe the government has already picked the biggest winners and losers for 2023.
Last night, I pulled back the curtain on a little-known strategy that can give you a chance to profit from both the winners and the losers – at the same time.
Plus, I gave away the name of one stock to buy… and one to avoid… for free. If you missed it, I asked my publisher to keep it online for a little while longer. You can catch the replay right here.
Now, let’s get back to this week’s mailbag.
Up first, one reader weighs in on my recent essay on silver. In it, I showed you why silver is poised for a rally this year…
I hope you are right. I have some silver bullion coins. That’s my only investment besides real estate.
– Betty B.
Hi Betty, thank you for writing in.
Silver coins are a terrific investment for the long haul, even in years where silver prices are moving lower or sideways. Though I do expect silver to rally, as I noted in that piece.
With regard to investing, everyone has a different risk tolerance and comes from a different perspective. I can’t give personalized advice. But I applaud your two choices. Both have use and wealth-creation value from a financial security-building perspective.
If you do ever want to gain some more knowledge about other opportunities out there, I would recommend you check out our Distortion Report advisory.
In it, we provide a lot of analysis about various aspects of the economy and sectors most impacted by The Great Distortion between the real economy and the markets. We also provide a stock recommendation each month with our analysis on it.
One of our core recommendations in the Distortion Report is a company that holds physical silver. Silver’s uses are broad, especially in the era of Infrastructure and New Energy expansion – which my regular readers know are two of my distortion investment themes.
To find out more about this specific silver company, use this link to find out how you can join our flagship service and start making money today.
What percentage of the portfolio should be considered for silver? Is this a long-term (buy and hold) investment, or do you expect this to be five years or less?
– Arlene M.
Hi Arlene, that’s an excellent question. It gets to the core of how one views short- vs. long-term investment portfolios.
Now, first off, remember that I can’t give personalized advice. But in general, here’s what I would say to all my readers.
I consider an investment portfolio as containing a diversified set of investments that we hope to grow over time.
These may be subject to market fluctuations. So, they should be funded with money that we don’t need to access right away or even soon. In other words, money we can afford to do without.
Investment portfolios can include stocks, bonds, real estate investments, commodities, and even cash (see my answer to Allen below for more on that).
That said, in general, I think having 10% of a long-term investment portfolio in a combination of gold and silver is a good move in times like these.
I have a slight preference for silver because it is cheaper than gold. So within that, I would personally allocate more to silver than gold.
I am an Agora and Legacy Research lifetime member. In your opinion, where would be two of the safest investments for a short (90 days or less) asset? Like in Treasury Bills, money market, etc. I know they wouldn’t cover inflation, but they would be better than the bank’s average 30 basis points.
– Allen T.
Hi Allen, thanks for writing in. That’s a terrific question. As I often say in these pages, sometimes it’s prudent to sit on the sidelines when markets are at their most choppy, depending on your risk tolerance.
Again, I can’t provide personalized investment advice. But in general, one way to invest in markets like these is by parking cash in a high interest-bearing Certificate of Deposit (CD), to stay super safe.
That locks in a rate, and it can work best for people whose time horizon is closer to a year. It can be better than putting money in a money market or Treasuries account, where market fluctuation can alter the investment’s returns.
For anyone interested in getting the latest information, a good place to see what’s available is bankrate.com. This link on their website shows how little the big banks provide vs. other options.
Another option for those looking to park some of their money on the sidelines in the current market is to move it to a higher-yield savings account. Here’s a link to Bankrate’s current listing of the highest-yielding savings accounts. They range up to 4%.
A word to the wise: typically, it’s possible to get higher interest rates at online banks than at national, brick-and-mortar banks.
Savings accounts are also insured by the Federal Deposit Insurance Corporation (FDIC) at banks and by the National Credit Union Administration (NCUA) at credit unions.
So it’s the kind of investment that lets me sleep easy at night.
And three, those interested can also consider getting a cash management account. This allows one to put money in a wide range of low-yield market funds.
With a cash management account, investors can typically withdraw their money at any time. That’s an advantage over a money market and traditional savings accounts, which tend to limit monthly withdrawals.
Here’s also a link to Bankrate’s current listing of the highest-yielding cash management accounts.
And that’s all for this week’s mailbag. Thanks to everyone who wrote in!
If I didn’t get to your question this week, look out for my response in a future Friday mailbag edition.
I do my best to respond to as many of your questions and comments as I can. Just remember, I can’t give personal investment advice.
And if there are any other topics you’d like me to write about, I’d love to hear from you. You can write me at [email protected].
Happy investing… and have a fantastic weekend!
Editor, Inside Wall Street with Nomi Prins