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Looking at my retirement money, and wondering what specifically could go up in the event of a crisis on the scale of what happened in 2007 to 2009.

There is a Gold and Mining Fund, but it actually crashed in 2008 along with most everything else.

Is there a way to invest in gold through Vanguard? Or is there something else that went up in 2008?

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    Why do you believe gold will perform well in a financial crisis? – keshlam Nov 13 '16 at 1:11
  • Depending on the nature of the crisis, I think gold is something investors run to. It shouldn't sky rocket, but it should reliably see upward movement, where most other investments will go down, or at least behave unpredictably. That's my guess anyways. I can't think of a better place (perhaps just cash) for an impeding crash. – Costa Nov 13 '16 at 19:47
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In 2008, 10 year treasuries were up 20.1%, to gold's 4.96%. Respectfully, if I were certain if a market drop, I'd just short the market, easily done by shorting SPY or other index ETFs.

If you wish to buy gold, the easiest and least expensive way is to buy an ETF, GLD to be specific. It trades like a stock, for what that's worth. There are those who would suggest this is not like buying gold, it's just 'paper'. I believe otherwise. It's a non leveraged, fully backed ETF. I try not to question other's political or religious beliefs or as it pertains to this ETF, their conspiracy theories.

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I found a comparison of stock and bond returns. The relevant portion here is that bonds went up by 10% in 2007 and 20% in 2008 (32% compounded). Stocks were already recovering in 2009, going up almost 26%.

You don't mention what you were hoping to get from your gold investment, but bonds gave a very good return for those two years.

  • Bonds have a positive return when interest rates are going down, and a negative return when interest rates are going up, and a (mostly) flat return when interest rates are holding steady. Before making an investment decision, consider which of these is most likely to describe interest rate movements going forward. – a CVn Dec 17 '16 at 17:09
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The difficulty with investing in mining and gold company stocks is that they are subject to the same market forces as any other stocks, although they may whether those forces better in a crisis than other stocks do because they are related to gold, which has always been a "flight to safety" move for investors.

Some investors buy physical gold, although you don't have to take actual delivery of the metal itself. You can leave it with the broker-dealer you buy it from, much the way you don't have your broker send you stock certificates. That way, if you leave the gold with the broker-dealer (someone reputable, of course, like APMEX or Monex) then you can sell it quickly if you choose, just like when you want to sell a stock.

If you take delivery of a security (share certificate) or commodity (gold, oil, etc.) then before you can sell it, you have to return it to broker, which takes time.

The decision has much to do with your investing objectives and willingness to absorb risk. The reason people choose mutual funds is because their money gets spread around a basket of stocks, so if one company in the fund takes a hit it doesn't wipe out their entire investment. If you buy gold, you run the risk (low, in my opinion) of seeing big losses if, for some reason, gold prices plummet. You're "all in" on one thing, which can be risky.

It's a judgment call on your part, but that's my two cents' worth.

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