Australian Investment Blog

Ouch we’re long Westpac! Yesterday certainly fitted that old sporting adage for Market Matters - "a game of two halves". Regis Resources (RRL) Firstly we were able to realise excellent profits – around +27% by selling our Regis Resources (RRL) over $3 yesterday, a position that was initiated on the 17th of March. Selling is a weakness of many investors who unfortunately fall into the habit of "running losses and cutting profits". We are more aligned with the motto "plan your trade and trade your plan" - obviously the word trade can be replaced with investment. When we purchased RRL the plan was to take profit over $3 unless circumstances had changed; they had not hence we sold. Overnight gold initially rallied strongly over $US1300/oz before falling away and closing slightly lower - gold ETF's were down 1.7% in the US. Our view is gold is likely to retrace back towards the $US1200/oz area in coming weeks / months where we currently intend to buy back into the sector. Statistically May is the strongest month for the $US since the GFC which is clearly a negative for gold. This correlation may be linked to seasonal factors like - weak stocks and commodities plus U.S. economic data often improving in May aided by weather. Either way statistics like this should be respected, and we are comfortable watching gold at present. Also remember we have no ego with investing and will happily buy RRL back at higher prices if we perceive good risk / reward - just like we did this time! Gold Weekly Chart