Which route would you take?

by **chakra** » Wed 17 May 2006, 20:46:38

I'm currently a home owner who's mortgage is coming due in 2 years. I have some extra money in the bank and I've also been putting 10 percent of my earnings away for the last 5 years. Recently I moved 24,000 dollars into this fund.

http://www.agf.com/t2scr/static/app/fun ... und210.jsp

The fund invests in Canadian oil and mining companies. The market has been very bullish and the fund has risen by almost 70 percent in the last year. I feel like I might of made a mistake because in the last 2 weeks since I moved the money I've lost $2000. Commodity prices have been going down ever since I moved my money into this fund (figures).

A few weeks ago I purchased 60 oz of silver at around 14.50 an oz.

My first question is whether this fund is a good idea?

My second question is would you put all your extra money down straight onto the mortgage, or would you purchase silver or gold now and then when the mortgage went to renew in 2 years cash it in to pay off the mortgage? I was learning more toward purchasing silver and hoping the whispers in the air about commodity prices continuing to rise are true.

I was hoping that the markets would bull just one more time this year so I could move some money into a more secure location to withdraw to help pay off the house in 2 years. The problem is if you loose when you first jump into a fund like I have, you have to make huge gains afterwords just to break even. For example if the fund crashed by 50 percent I'd only have 12,000 of my money left. If the following year it went up 50 percent I'd be left with only 18,000 of my 24,000. So now I'm questioning whether I made the right move. Should I stick with this fund for the long run and just expect a readjustment and take the loss?

Any advice would be very appreciated.

Thanks.

by **Doly** » Thu 18 May 2006, 05:25:25

$this->bbcode_second_pass_quote('chakra', '
')My second question is would you put all your extra money down straight onto the mortgage, or would you purchase silver or gold now and then when the mortgage went to renew in 2 years cash it in to pay off the mortgage?

by **JohnDenver** » Thu 18 May 2006, 05:28:55

$this->bbcode_second_pass_quote('chakra', ' ')I feel like I might of made a mistake because in the last 2 weeks since I moved the money I've lost $2000.

by **chakra** » Thu 18 May 2006, 06:34:47

With the strong possibility of a war in Iran wouldn't it be possible for these funds to gain in the short term?

Is this a lull before the storm in buying or selling? During times of inflation isn't it good to invest in commodities and isn't inflation about to hit North America in a bad way?

Any more opinions would be appreciated.

by **Madpaddy** » Thu 18 May 2006, 06:59:32

Chakra,

I'ld go with Doly's advice. Long term commodities are a safe bet but I can see a crash in the short term if and when there is an economic slowdown. Don't buy now.

But of course if I could answer your query in full confidence, I'ld be kicking back on the Bahamas smoking Monte Christos and getting sandwiched by those fat hookers JD mentioned.

by **chakra** » Thu 18 May 2006, 08:02:23

I moved my Canadian Resource fund into a conservative portfolio. Now I'm bummed that I lost so much money. I was betting that the war with Iran coming up would drive up the fund, but I can't risk a total colapse and loosing everything I've saved.

I'm sure the fund will pick up and gain 25 percent or something in the next few months. That's how murphy's law works. Hehe.

by **chakra** » Thu 18 May 2006, 12:09:35

Could anyone here answer another question for me. I just moved my money into this fund here.

https://ssl.grsaccess.com/fundreports/e ... /LCOPO.pdf

They call this a low risk portfolio, but I was wondering how much risk still existed in this fund. Is it possible to see large losses still even though this is considered low risk?

During stock market crashes how do these low risk funds do? Do they at least maintain their value, or do they loose large percentages over night like more risky stocks?

I've been trying to find out what happens to bond funds and other such low risk investments during recessions and depressions but I've had trouble finding the information.

This fund has 22 percent of it's money in Mortgages too, is this a bad thing with a possible housing bubble burst?

Thanks again.

by **ModernAngel** » Thu 18 May 2006, 13:40:33

$this->bbcode_second_pass_quote('chakra', '
')They call this a low risk portfolio, but I was wondering how much risk still existed in this fund. Is it possible to see large losses still even though this is considered low risk?

During stock market crashes how do these low risk funds do? Do they at least maintain their value, or do they loose large percentages over night like more risky stocks?

by **jdmartin** » Fri 19 May 2006, 00:52:05

I vote for paying off the house. You can't live very well inside a stock portfolio :lol:

by **mjpete** » Fri 19 May 2006, 01:40:33

Any money you put in the market, should be money you plan to leave there at least 5 years, otherwise you are taking a considerable risk that it will go down, usually just when you want to take it out. Short term trading of stocks is speculating and you might as well go to the casino and play some blackjack. Your chances of guess right about which way the market will go are probably not much different that winning at blackjack.

I would use the money to pay down your house, after you take out 3-6 months of expenses to keep in an emergency fund. You can make more money, but you are also increasing your risk.

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