In 2003 we purchased 40 ounces of Platinum from my McAlvany Precious Metals advisor (fka ICA). We traded those for 140 ounces of Palladium in 2009. Recently, we sent back the Palladium and switched to Platinum again, receiving 95 ounces. We now have more than double the ounces of Platinum that we started with and triple the dollar value that we originally invested.
– R.R. – Minnesota
What Happened?
For generations, productive Americans have taught their children to save a portion of what they earn, put it in a savings account, and let compound interest grow its value over time. It was great advice for its time, but its time is past. Interest payments on bank savings are so small they can’t even overcome inflation and fees – which means that saved funds will shrink over time rather than grow. When you couple that fact with major bank failures in recent years, the inadequacy of the FDIC to adequately insure more than pennies on the dollar of all deposits at risk today, and the groundwork that has been laid for “bail-ins” (using depositors’ money to meet banks’ need for emergency funds), savings accounts can no longer be considered safe.
It’s no wonder savers feel like they can’t win. Both living and investing in America today is like going up the down escalator. Rest for a moment, and you might not be able to gain back the position you’ve lost. Stocks are in the riskiest territory they’ve ever been in (including 1929, 1987, 2001, and 2008), and with yield in the cellar and the world moving away from the dollar, bonds are also at extreme risk.
What’s a saver to do?
Well, what if there was a way to save without risk of loss caused by government or financial emergency, but which also offered the opportunity for gain?
What if you could save your money and grow it too?
In order to do this, you’d have to accomplish two goals.
- Don’t ride the escalator down. (Keep your money from buying less over time as inflation increases your cost of living. This is called “maintaining your purchasing power.”)
- Rather than just maintaining your position, start moving up the escalator. (ie: increase the amount of your money.)
Gold maintains your purchasing power over time. That’s not something that has proved true just since the founding of the Fed or even the Bank of England. For over 5,000 years, there have been two universal truths in the financial world:
- Real assets maintain real value.
- Gold is real money.
No asset accomplishes the first goal better than gold.
But what if you want to do more?
A lot of investors come to us out of frustration. They’ve taken some misdirected approach to their finances, and they’re either unhappy with the results or fearful that they’ve squandered what they’ve worked so hard to build. Some even come to us with dead-end precious metals portfolios due to bad advice on the initial acquisition! These investors seek us out because they’ve come to understand that gold and other precious metals offer incredible financial protection.
But they want more than protection. They want potential.
They want to put their trust (and their money) in a proven system that will compound their investment AND ensure that the money is there when they need it.
We’re happy to report that this system exists. At McAlvany Precious Metals, it’s affectionately known as the “Ratio Trading Strategy,” and it begins by asking one simple question:
How many ounces of silver does it cost to buy an ounce of gold?
For the last 45 years, McAlvany Precious Metals has tracked the price of silver relative to that of gold, and regularly looked for opportunities for clients to make strategic shifts between the two metals. By buying whichever of the two is weaker, watching it grow stronger, and then continually repeating the process, you can increase the amount and value of your holdings over time with very low risk. As you may already know, the price of precious metals responds to various influences. Industrial supply and demand issues, central bank demand, investor demand, and geopolitical events all impact the metals at different times to differing degrees. We can’t control these events, but we don’t need to. Instead, we can use them to our financial advantage.
The McAlvany Precious Metals Ratio Trading Strategy operates under the following immutable law: The value of gold and silver relative to each other fluctuates over time (platinum and palladium can also be used if desired, as this law also applies to them). Said another way, although the prices of the precious metals usually move in the same direction (up or down), they move at different speeds. Over time, one of the metals will be trading at a significant discount to the others. By trading one for another, an investor can move out of an overvalued metal and into an undervalued one with ease and safety.
In just a few trades, a portfolio can be abundantly enhanced!
The strategy is perfect for the conservative, long-term precious metals investor. While most trading “tricks” involve jumping in and out of markets and trying to hit every top and bottom, this strategy is quite different. You are never out of physical precious metals when you correctly employ our Ratio Trading Strategy. For example, if the strategy calls for selling gold, you will be simultaneously buying silver.
If it calls for selling silver, you will be simultaneously buying gold. Many of the best trades are executed during drops in price rather than increases. And you’ll never purchase an investment whose value can become completely worthless like stocks or other investment vehicles can.
You have constant protection against inflation or financial upheaval
Our strategy doesn’t focus on the increase in the price of the metals, but rather on the increase in the ounces of metals. Over the years, you’ll watch your number of ounces of precious metals increase just as you watched your savings grow in the past. Those who simply buy and hold precious metals during bull markets do well. However, clients that empower us to employ the Ratio Trading Strategy not only ride the price of the metals up, but also greatly increase the amount of their ounces.
This can produce a staggering return when the price climbs, underscoring the power of compounding
Many clients who participated in this strategy in previous bull and bear markets in the metals more than doubled their ounces of metals, most tripled their ounces recently in the platinum/palladium swaps.
Who can participate?
We can employ the Ratio Trading Strategy with metals in your possession or that you’ve stored. Many of our clients currently participating in the strategy use storage accounts. Additionally, IRAs and tax-deferred accounts make ideal vehicles for this compounding strategy.
- A physical precious metals position with the proper initial positioning
- A long-term mindset. These strategies are best suited for those committed to the precious metals for the longer term.
- Patience
- A precious metals advisor to assist you in timing your trades. Our advisors have been helping investors for decades.
Do you have additional questions or want to get started?
Download our complimentary Market Readiness Worksheet
A simple step-by-step print-ready guide to help investors prepare their portfolio for mass-market disruption.
This worksheet allows investors to take advantage of markets without leaving themselves vulnerable to massive downturns. Get a clear picture of your portfolio’s positioning, allowing you to create a stable platform for a healthy financial future.
