Rebalancing - how often for gold?

Mark Adams

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Rebalancing - how often for gold?

mark_adams👑Elite (1m-5m)

about 1 month ago

Key Takeaways

•Quick question for the group on portfolio rebalancing, specifically for the gold allocation.
•I'm a big believer in diversifying beyond traditional equities and bonds, especially with the current market volatility and inflation looking sticky.
•I've had a decent chunk, probably around 8-10% of my ~3M portfolio, in a Gold IRA for the past four years or so.

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Quick question for the group on portfolio rebalancing, specifically for the gold allocation. I'm a big believer in diversifying beyond traditional equities and bonds, especially with the current market volatility and inflation looking sticky. I've had a decent chunk, probably around 8-10% of my ~3M portfolio, in a Gold IRA for the past four years or so. It's done exactly what I wanted it to do – acted as a hedge and store of value, particularly when other sectors were getting hammered.

I usually rebalance my overall portfolio quarterly, sometimes semi-annually if things are relatively stable. For equities and fixed income, that cadence works well to keep things aligned with my target allocation. But I'm wondering if gold, given its role as a more long-term, strategic asset, warrants a different approach. Should I be rebalancing my gold position as frequently as I do my other asset classes? Or is it more of a "set it and forget it" kind of thing, maybe once a year or only when there are significant macro shifts?

My initial thought is that gold is less about chasing short-term gains and more about preserving capital and acting as an insurance policy. So, constantly trimming or adding to it might be counterproductive to its core purpose. However, if it significantly outperforms (or underperforms) the rest of the portfolio, it could throw my desired overall asset allocation out of whack. I’m thinking about maintaining that 8-10% range. What do some of you more experienced Gold IRA investors do? Is there a common best practice for this?

Appreciate any insights. It's always good to bounce these ideas off people with different perspectives.

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5 comments

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Best Answer▲ 9 upvotes

sharon_evans💰Established (100-250k)

Dude, I hear you on the rebalancing. I used to be super strict about a yearly rebalance for everything, including my gold. But honestly, I found myself stressing out more than it was worth. Like, if gold had a killer year, I’d trim it back and then feel like I missed out because it kept climbing.

Lately, I've been more about condition-based rebalancing for my gold – like, if it really takes off or dips hard, then I'll look at it. Otherwise, I let it ride. It's cut down on my anxiety a ton. 8-10% sounds like a solid anchor, though.

Comments (5)

sharon_evans💰Established (100-250k)Real Investor•about 1 month ago

susan_clark💰Established (100-250k)Real Investor•about 1 month ago

Hey, interesting post! When you say "decent chunk," are you talking strictly physical gold, or does that include gold ETFs/mining stocks as well?

kenneth_parker💎Premium (500k-1m)Real Investor✓ Verified•about 1 month ago

Interesting take. I'm a bit more hands-off when it comes to rebalancing my gold. Honestly, unless there's a major, structural shift in the economic landscape, I tend to let it ride. Gold's role in my portfolio isn't really for short-term gains I need to capture by rebalancing, it's more of a long-term hedge. Fiddling with it too much feels like trying to time the market, which usually doesn't end well.

dorothy_lopez💰Established (100-250k)Real Investor•about 1 month ago

Hey, good question! For gold within an IRA, I generally think about rebalancing less like a strict calendar event and more like a "triggers and thresholds" approach. Since gold often acts as a counter-cyclical asset, you might rebalance when your allocation drifts significantly (say, +/- 2-3% from your target).

One resource I've found helpful for broader portfolio rebalancing strategies, which you can adapt for your gold allocation, is this article from Vanguard: Vanguard Rebalancing Your Portfolio. It breaks down different approaches like calendar-based vs. threshold-based. Might give you some ideas for your specific situation!

dorothy_lopez💰Established (100-250k)Real Investor•about 1 month ago

Totally agree with you on the increasing importance of diversifying beyond just stocks and bonds right now. Inflation feels like it's here to stay for a while.

My own gold allocation is currently sitting around 12%, and I'm thinking of letting it ride a bit longer too. I usually rebalance my overall portfolio quarterly, but with gold, I've been more opportunistic – if there's a big spike or dip, I'll consider adjusting, otherwise, I let it float a bit more than other assets.

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