# It takes money to make money



## 4metals (Jun 24, 2016)

Wow gold did some moving in the short term and it made me do some thinking. Some people, Guy's with money, probably like Ralph (Palladium) :roll: and Dave (Frugalrefiner) :roll: who wanted to gamble on the Brexit thing going on over in Europe, had a potential to do very well with little risk. 

If you had a cool million to invest, you could have leveraged at least 5 times that value in metal.

so you take your million and buy (1,000,000/1260) = 793.65 ounces at the close on Tuesday. But you don't take physical metal, you take paper and you leverage it and pay 20% of each ounce and buy (793.65 X 5) = 3968.25 ounces. Less broker's fees.

now you put in a sell order for Friday morning to sell it all when the exchange opens. So you sell it all, get back your million plus the $75 an ounce gold went up when Great Britain opted out of the EU. 

That's ($75 X 3968.25) = $297,619. Overnight while you were sleeping. That' almost like "money for nothin and the chicks for free!" (Not exactly Dire Straits!)

So you spent 5 times more money than you ever had at risk, and bought the use of 3968 ounces (that the broker who sold it to you didn't have either, it was paper gold). There is something fundamentally wrong with not having to take delivery and pay for your speculation. Who makes those rules?

You millionaire's have it good!


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## Palladium (Jun 24, 2016)

Lol. Believe it or not I was up at 3:00 this morning watching the market and calculating currency exchange rates. 
I'm a purely physical guy!


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## 4metals (Jun 24, 2016)

Yeah but if you traded in your physical for cash you wouldn't get the multiplier because your money is all in at face value so you only make $75 an ounce. But if you bought paper your money goes 5 times further and so do your profits. I would use paper to hedge but my long term asset is purely physical. 

The guys with less skin in the game make the most. Ya gotta play with their rules!


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## FrugalRefiner (Jun 24, 2016)

Ha! :lol: I slept in till 7:00 like usual. Had my morning tea while watching the news and learned the results of the vote. I'm just a simple guy and don't pretend to be able to forecast what's going to happen, so I don't try and I don't speculate. Besides, I had to stop investing in silver when we bought the new house. Other than trying to help someone out from time to time, I haven't had money to spend on metals for months.  

Dave


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## Barren Realms 007 (Jun 24, 2016)

It was a 50/50 split by the poles from what I read a couple of days ago. So that being said you could have also lost that same amount by making the bet.


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## justinhcase (Jun 25, 2016)

Well we(The U.K.) are in the toilet now.
The Sun News Paper and the B.N.P. have royally hung the U.K. out to dry in the sun.
We now have a two year period where we can not signee any new trade deals with any one until all the exit accounts can be finalised.
The best estimate is two years. but as it would benefit France and Germany to hold this process up it has left us completely vulnerable.
The national accountants association ,the teachers and lecturers, the police and armed forces, the doctor's and nurses. all screaming not to opt out.
But the majority win again.
It is like being stuck on a high speed bus, and no mater what you do or how you reason with them there is absolutely no way of wrestling the steering wheel out of the control of people who are truly and utterly deluded and have no motor skills or control of there twitching..
Half of my colleges are popping champagne and the more enlightened half are considering self euthanasia.
Good luck predicting any kind of out come from that box of frog's.
Choosing a winner always seems simple after the race which is why only the bookies and stock brokers win in the end.


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## macfixer01 (Jun 25, 2016)

justinhcase said:


> Well we(The U.K.) are in the toilet now.
> The Sun News Paper and the B.N.P. have royally hung the U.K. out to dry in the sun.
> We now have a two year period where we can not signee any new trade deals with any one until all the exit accounts can be finalised.
> The best estimate is two years. but as it would benefit France and Germany to hold this process up it has left us completely vulnerable.
> ...




Well you could always move to Canada. That's the threat the overly-vocal Hollywood intelligentsia always make when they aren't happy with something about to happen here in the USA. It's funny though, none of them ever follow through on their threats? There are several of them that I wish would just leave already!


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## patnor1011 (Jun 25, 2016)

I did it easier. 
I bet some money on exit as ods were just too tempting 5/1.
It wasn't any big money as I do not usually gamble but I made 5x more than I put in while I was sleeping.


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## justinhcase (Jun 25, 2016)

patnor1011 said:


> I did it easier.
> I bet some money on exit as ods were just too tempting 5/1.
> It wasn't any big money as I do not usually gamble but I made 5x more than I put in while I was sleeping.


Darn! I did not think of that.
I knew it would go south just because the middle men will make more money out of the Chaos than they would out of a free for all debate.
Should have bought Royal Mail share's as well.
I always have my head down working. It took a friend who is a lecturer to come around and remind me to vote at 18-00hrs so I almost forgot about it completely.
:lol:
And I am giving some serious thought to moving my self to an other location, Canada douse sound nice and it is a part of the common wealth so immigration is easier.
The U.S. and Australia Have a problem with my old firm, something about a disruptive influence on the younger population so I counted them out.
Costa Rica looks good, especially because of the female beach volley ball teams.
find me a small gold mine with in easy drive of a nice beach where I can set up my Bar and sound system I will be there.


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## 4metals (Jun 25, 2016)

> It was a 50/50 split by the poles from what I read a couple of days ago. So that being said you could have also lost that same amount by making the bet.



The price hadn't moved upwards very quickly before the vote so if the vote went to no exit, I would not expect gold to have plummeted down in price as quickly. Chances are you would have lost some money but the potential gain was much greater than the potential loss.


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## GOLDbuyerCA (Jun 25, 2016)

Saying that, i have been in forex trading since Jan. 2 week of this year, watching our Canadian dollar fall like a rock to the US dollar, and watching Canada sell of all its " our " gold reserves, 250 tons of the stuff, to money markets. " to pay our bills " . well i was shorting like mad, and lost 17 out of 20 bets on shorts, shorted out, all my money, usually 70 USD a bet. hoping with 400 to one leverage, to make some good gains. " well you Yanks " do not have access to these high risk accounts Brits do, my trading house is in the UK. So, in what your talking about, i bet 150 usd, on 50 micro lots, at 1257. and used my margin, when i could to double and double again my micro accounts, . to say the action was exciting was an understatement, as i was following the British Pound against the US dollar in my time zone utc. -7 Pacific coast time . from 4. 15 am, to 7, 40 when i closed. i did a snap chart so you can see the may hem that occurred. i sold my gold margine on the gold peak, when the news of not exciting was announced, " that was a bankers set up imo " and held the dip, making good. now, this is not for the faint of heart, or those that 100 is to much risk, i had not done well in this, until this Brexit thing. it requires a learning curve on terms and trends, and news, " most news is bogus " made for market volatility, Volitility makes the market. chart attached.


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## goldenchild (Jun 28, 2016)

It must be nice to have so much money you can casually play with a million quid.


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## upcyclist (Jul 5, 2016)

I wasn't thinking of anything nearly as well-developed as 4metal's OP--just that post-Brexit vote, now would be a great time to unload some gold if you'd been hanging on to it "waiting for the right market"...


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## Palladium (Jul 5, 2016)

upcyclist said:


> I wasn't thinking of anything nearly as well-developed as 4metal's OP--just that post-Brexit vote, now would be a great time to unload some gold if you'd been hanging on to it "waiting for the right market"...



?


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## upcyclist (Jul 5, 2016)

Okay, a little more explanation. The Brexit vote pushed gold prices up, as some people scurried for safe harbors, and others did some speculation on the same. I figured if any of us refiners had gold that hadn't been sold yet, now was a good time. This is of course excluding any gold people are stashing in their retirement funds.

Basically, especially for small-timers like me who don't yet have a regular gold-selling destination, now might be a good time to find one. Except me, because I still have less than a hundred bucks in buttons


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## justinhcase (Jul 5, 2016)

upcyclist said:


> Okay, a little more explanation. The Brexit vote pushed gold prices up, as some people scurried for safe harbors, and others did some speculation on the same. I figured if any of us refiners had gold that hadn't been sold yet, now was a good time. This is of course excluding any gold people are stashing in their retirement funds.
> 
> Basically, especially for small-timers like me who don't yet have a regular gold-selling destination, now might be a good time to find one. Except me, because I still have less than a hundred bucks in buttons


Yes very motivated and scrimmaging through all the little bit's that where put to one side for one reason or other and the waste bins.
Making buying a bit of an issue as you can not be certain when the bubble will burst and the price drops back.
But giving me time to spring clean.


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## 4metals (Jul 5, 2016)

You can't let your metal work for you if you keep it locked up in a vault!

With the way metal prices are manipulated today, money can be made by just watching the prices and making educated guesses. I trade 3 kilo's of gold routinely. When the price is high and I think it isn't going to hold, I sell them. When it plunges back down (usually $75 to $100 variation) I keep an eye on it and when I think it is at bottom, buy them back. The difference in dollars is between $7200 and $9600. After the selling and buying fee's I'm still ahead of the game, and last year I traded 7 times. (Actually 6 1/2, one was over the years end)

I didn't nail the highs and lows with precision but I ain't complaining. Even after taxes it isn't so bad. I could have left them in a safe but all they do there is gather dust, and today I still have the metal. (But it may be sold soon, I'm thinking it is topping out)


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