CEF Follow-Up

I am sure many of you have seen the headlines. Gold Climbs above $700


Metal mania: Aluminum hits 18-year peak


Copper surges on supply woes


Commodities are breaking out to new highs daily.  Unfortunately only those considered the “smart money” are benefiting from these record prices.  My guess in about five years your advisors and brokers will start calling telling you about a hot new gold stock.  The objective of  “The Time and Money Group” is to provide resources and information to enable you to take charge of your financial future.  Hopefully, we will help you become part of the “smart money” crowd. 

A few of you purchased the Central Fund of Canada (CEF) that was discussed on 4/17 and have enjoyed a 10% increase in value.  That’s right 10% in three weeks in what I described as the simplest most conservative way to make money over the next 5 years.  Many believe that knowledge is power, but acting on knowledge is truly the power.  CEF can be purchased on the stock market in the same manner as any stock.

“Central Fund invests in gold and silver bullion and does not speculate with regard to short-term changes in gold and silver prices. As of October 31, 2005, on a physical basis, 50 ounces of silver were held for each ounce of gold held. During such time, Central Fund’s net assets at market value of approximately $541 million consisted of 53.9% gold bullion and certificates, 44.5% silver bullion and certificates, and 1.6% cash, marketable securities and other working capital amounts.”

So, the question you maybe asking now – is it too late?  Citigroup doesn’t think so.

Citigroup to Double Commodities Staff as Prices Soar
May 9 (Bloomberg) — Citigroup Inc., the world’s largest bank by market value, plans to almost double staff at its commodities-trading unit worldwide as competition increases on Wall Street for a greater share of growing energy and metals markets. Citigroup plans to increase the number of people trading oil, metals and other commodities to 150 by the end of the year from 85, John Casaudoumecq, the bank’s global head of commodities, said in an interview yesterday. Citigroup intends to expand power and gas trading in North America to Europe and start trading coal and carbon-dioxide emissions. “Our goal is to take what we do in interest rates, foreign exchange and credit risk and apply it to commodities,’’ said Casaudoumecq, who is also global head of fixed income at New York-based Citigroup. “We are in a long-term commodities cycle, which may last 15 to 20 years.’’

The stock market moves in up waves and down waves.  We are overdue for a down wave.  So, unless you want to learn technical analysis to increase your probability of detecting peaks and valleys – simply employ the time proven strategy of dollar cost averaging.  “Dollar cost averaging is a technique designed to reduce market risk through systematic purchase of securities at predetermined intervals and set amounts.” 


Start dollar cost averaging into CEF.

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