Posted on 10/10/2010 5:17:24 PM PDT by grey_whiskers
Yet_again wrote: “While diversified, such a portfolio will be destroyed if what looms on the horizon comes to pass. Devaluation of the dollar will not magically make stocks rise.”
No, this portfolio will not be destroyed by a US dollar collapse, 40% of S&P earnings are from outside the US. If the dollar falls drastically, the value of those offshore earnings goes up!
Your suggested portfolio of swiss francs and gold, has no interest income, earnings, or dividend yield. It’s good for a US hyperinflation, but what about deflation, or stagflation, or a normal economic recovery?
Undiversified portfolios can yield higher investment returns, at the cost of much higher risk.
My suggestion for someone who is worried about the potential collapse of the US dollar. Why not use options such as those on, say, UUP, and leave the rest of the portfolio with a sensible diversified allocation?
Is there a US investment fund for rare Earth metals?
Well, there’s a well known Canadian fund, North American Palladium.
And there’s NYMEX
http://en.wikipedia.org/wiki/New_York_Mercantile_Exchange
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