What is the optimum ratio of G/S/C?

[Jetstream]

This subject will likely have as many answers as posters. But it is a valuable one to hear other opinions on. I am still looking at the issue for myself, but am interested in the thoughts of others.

By percentages (valued in current dollars), how much would you advise holding in:
1. Silver
2. Gold
3. Cash

As important as PMs are, a certain amount of cash is still advisable in my opinion, but I am amazed at the varying amounts suggested by different gold/silver bugs that I have talked to.

So ... let the debate begin.

 

[rblong2us]

I guess it depends on what kind of emergency you are preparing for.

An interruption to fuel supply that stops the food trucks for a while and very quickly everything gets grabbed and things go bad. Eventually things get moving again but a LOT of damage has been done.
So perhaps a 90 day self sufficiency and the means to purchase, which would most likely be cash.

Another scenario would be hyperinflation / failure of paper. This would require a longer period of time to run its course and would evolve from paper transactions to physical things. Plenty of everything in advance then but a chance to see it coming and probably the basis of discussion for the opening question.

Total SHTF ? Dunno that it really matters how much shiny you have, because now skills are the thing of value.

 

[pmbug]

I view this question as essentially the same as the stack size question.

I would say cash is the only one of the 3 that has a hard (not percentage terms) upper limit. You want enough cash to be able to live/pay bills for X number of months should bank holidays materialize. You want to secure useful things (land, tools, etc.) and anything left over goes into safekeeping/storage (ie. PMs).

I think the ratio of gold - silver holdings is really going to depend upon how much wealth you want to store. Silver works great until you acquire so much that it's hard to hide / move around.

YMMV.

 

[Jetstream]

@ rblong2us:
For me it is not primarily preparing for emergency, although that is factored in to my long range thinking.
It is for retirement / wealth preservation / emergencies / leaving inheritance all combined. Personally, I have pretty much viewed cash as simply a tool for immediate expenses and for a period of time should there be a need. How long a period of time does one need to have cash for? I hear everything from 3 months to a full year of living expenses. I am leaning toward the shorter time frame of those two because long before the year was up, something would develop.

@ PMBug:
This is similar to the stack size question but enough different that I didn't want to hijack that thread.
This has to do with what ratios / percentages go into the total 'stack'.
I have believed that silver would rise to its historic G/S ratio of closer to 20:1 from its current 50:1. That would make sense to buy silver now, and trade it for gold as the ratio narrows.

For a time then one's personal stack would be heavily into silver, but perhaps you should just buy the gold even though silver seems the better buy right now.

 

[benjamen]

$.02

I keep enough cash to cover the "emergency" fun. Usually you hear 3-6 months as a minimum, but I prefer 9-12 months as a personal preference. You never know what will happen or when it will happen, but eventually you will have a need for cash RIGHT NOW (auto repair, medical expenses, .....) When this happens, what happens if it the day after a metal price take down?!

As far as a break down of investments between the metals, that is largely influenced by personal preference and reasons for investing. Wealth preservation, investing, inflation hedge, emergency preperation, .....

I personally look at the ratios between the 4 precious metals. While I have a personal long term goal chosen for my personal silver to gold ratio, I still consider what is relatively cheaper ratio-wise.

Example:
My currently holdings of platinum exceed my long term ratio goal, but it is still VERY tempting based on extremely abnormal ratios compared to both silver and gold.