The lazy portfolios are the blazing beacons of passive investing. Once you’ve absorbed all the advice and theory you can stand about risk, cost and diversification, you’re still left with one crucial question:

“What does a simple, low cost, diversified portfolio look like?”

And that’s where the lazy portfolios shine a light. They’re rough-and-ready model portfolios designed by some of the champions of passive investing. Think of the lazies as a show home – a useful source of ideas for building your own portfolio.

A lazy portfolio’s standout features are:

• Simplicity

You only need a few funds to diversify across the key asset classes. This cuts costs and keeps the portfolio manageable.

• Low maintenance

You rebalance your funds occasionally, but otherwise leave them to make like an oak tree and grow. Novice investors can start with a very simple portfolio and add new funds from time to time, to further diversify.

• Low cost

Passive investors use cut-price index funds and Exchange Traded Funds (ETFs) to prevent high fund charges gobbling up their returns.

• Risk control

Every lazy portfolio sticks a hefty chunk into government bonds. The designers are drawing attention to the power of bonds to cushion your portfolio from equity market crashes. Your eventual allocation to bonds will depend on how much risk you can handle.

• No silver bullet

The lazy portfolios show there’s more than one way to cut the cake. Different portfolios suit different needs, mindsets and goals. But the truth is they will all put you in roughly the same ballpark. There’s no need to agonise over every percentage point split between asset classes.

You don’t need to pay for black box analytics to spit out some fully personalized “mean variance optimised, risk-calibrated” portfolio. You can just keep things simple and do it yourself.

Dirty Harry Vs Juliet Bravo

The lazy portfolios you’ll read about on the Internet and in books are mostly US orientated. But Monevator has converted them for UK readers using index funds and ETFs chosen from our market.

Cost rules our decision making. Every fund is selected on the basis that:

1. It fits the original investment category.
2. It’s generally the cheapest choice available by Ongoing Charge Figure (OCF) and any other upfront fund fees that apply.1

Translator’s notes

Stars and Stripes flavoured lazy portfolios are skewed towards domestic equities. Historically, American investors have been heavily biased towards the home team, and that makes a certain sense given the size, dynamism, and diversity of their domestic market.

UK investors may want to allocate a greater percentage of their equity allocation internationally, given that UK plc only accounts for about 8% of global market cap and that the FTSE All-Share and FTSE 100 are more concentrated than US equivalents.

When it comes to bond funds, we’ve chosen to make our UK picks less diverse. The US portfolios tend to use a Total Bond Market fund, split about 70% into US Government bonds and 30% into Corporate bonds.

In the UK, Total Bond Market funds are as common as apologetic bankers, so I’ve chosen to use UK Government bond trackers instead.

Why? Well firstly, we’re dealing in lazy portfolios. Secondly, bonds are meant to provide you with some protection against equities being hammered when markets are stressed. Government bonds are less correlated with equities than corporate bonds, and so more likely to do the job.

US lazies often tilt towards value and small-value equity funds. Historical evidence suggests that investing in downtrodden companies of this kind can juice your returns – in exchange for an extra dose of risk, of course.

Yet again the UK market responds with a shrug of the shoulders. There are no corresponding value and small-value trackers over here. The closest proxies are high-yielding dividend funds. Value equities by their very nature tend to pay out a good yield, so many of them are scooped into dividend funds. It’s an ill-fitting suit at best, but it’s what we’ve got.

Finally, for some authentically British home-cooking we’ve rustled up a version of  Tim Hale’s Home Bias – Global Style Tilts 4 portfolio.

Tim Hale is the only British commentator I know of who stands comparison to the black belts of US passive investing. I’d recommend his book to any UK investor.

Okay, let’s go!

1. Allan Roth’s Second Grader Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	60%	Vanguard FTSE UK Equity Index	0.15%2
Developed world	30%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Government bonds (Gilts)	10%	Vanguard UK Government Bond Index	0.15%

Very simple and very aggressive with a 90% equity allocation. One for the young and the brave.

2. David Swensen’s Ivy League Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	30%	Vanguard FTSE UK Equity Index	0.15%3
Developed world	15%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Emerging markets	5%	BlackRock Emerging Markets Equity Tracker D	0.28%
Property	20%	BlackRock Global Property Securities Equity Tracker D	0.28%
Government bonds (Gilts)	15%	Vanguard UK Government Bond Index	0.15%
Government bonds (Index-linked)	15%	Vanguard UK Inflation-Linked Gilt Index	0.15%4

The famed Yale fund manager is heavier in property than most. I’ve switched out the original US domestic property fund for a more diversified global property vehicle. The 50:50 split between conventional bonds and inflation-protected index-linkers is a classic lazy portfolio ploy.

3. Rick Ferri’s Core Four Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	36%	Vanguard FTSE UK Equity Index	0.15%5
Developed world	18%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Property	6%	BlackRock Global Property Securities Equity Tracker D	0.28%
Government bonds (Gilts)	40%	Vanguard UK Government Bond Index	0.15%

Ferri’s 60:40 split between equities and bonds is another common convention, broadly indicating a portfolio set for moderate growth and volatility.

4. Bill Schultheis’ Coffeehouse Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	10%	Vanguard FTSE UK Equity Index	0.15%6
Developed world	15%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Domestic value	10%	Vanguard FTSE UK Equity Income Index	0.25%7
Domestic small cap	10%	iShares MSCI UK Small Cap ETF	0.58%
Emerging markets	5%	BlackRock Emerging Markets Equity Tracker D	0.28%
Property	10%	BlackRock Global Property Securities Equity Tracker D	0.28%
Government bonds (Gilts)	40%	Vanguard UK Government Bond Index	0.15%

The original portfolio has a 10% allocation to small-value equity, which isn’t available in the UK as a tracker. Schultheis has also said:

If I were creating a portfolio today, I would increase the international allocation and include emerging markets, probably 5 to 7 percent.

So I’ve eliminated small-value, upped the developed world ex-UK by 5% and brought in emerging markets at 5%.

5. Harry Browne’s Permanent Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	25%	Vanguard FTSE UK Equity Index	0.15%8
Government bonds (Gilts)	25%	Vanguard UK Long Duration Gilt Index	0.15%9
Gold	25%	iShares Physical Gold ETC	0.25%
Cash	25%	High interest account	–

This truly is a portfolio for all-seasons. It’s armour-plated against inflation or deflation, recession, and even the good times. The assets have been picked for their contrasting behaviours, so whatever the conditions, some should thrive even while some dive. William Bernstein has written an excellent article about the permanent portfolio.

Note that the iShares gold vehicle is an Exchange Traded Commodity (ETC), not strictly an ETF.

6. Scott Burns’ Six Ways From Sunday Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	1/6	Vanguard FTSE UK Equity Index	0.15%10
Global equity	1/6	db x-trackers FTSE All-World ex-UK ETF	0.4%
Global energy	1/6	db x-trackers MSCI World Energy ETF	0.45%
Property	1/6	BlackRock Global Property Securities Equity Tracker D	0.28%
Government bonds (Global)	1/6	iShares Global Government Bond ETF	0.2%
Government bonds (Index-linked)	1/6	Vanguard UK Inflation-Linked Gilt Index	0.15%11

Some unusual choices here, including a global energy fund because Burns believes, “Energy is the ultimate currency and the ultimate commodity.”

This portfolio is also notable for its global government bond allocation. Diversifying away from domestic government bonds holds the prospect of greater returns but more volatility too, as currency risk comes into play.

7. William Bernstein’s No Brainer Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	25%	Royal London UK All Share Tracker Fund Z	0.14%
Developed world	25%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Domestic small cap	25%	iShares MSCI UK Small Cap ETF	0.58%
Government bonds (Gilts)	25%	Vanguard UK Government Bond ETF	0.12%

Another simple and aggressive portfolio that’s 75% in equities. Note the straightforward 25% split between asset classes. This is because passive investors understand that there is no ‘correct’ answer to asset allocation.

Fine grain allocations may look impressively scientific but are no more likely to provide a better return than a crude four-way slice of the pie.

N.B. I’ve thrown in alternative solutions for UK domestic equity and government bonds for this one.

8. Harry Markowitz’s ‘In Real Life’ Portfolio

Asset class	Asset allocation	Fund name	OCF
Global equity	50%	Vanguard FTSE All-World ETF	0.25%
Government bonds (Gilts)	50%	Vanguard UK Government Bond ETF	0.12%

A portfolio based on the oft-told tale that the Nobel Prize winning inventor of modern portfolio theory split his real life portfolio 50:50 between equities and bonds. The All-World ETF offers plenty of diversification in a single fund.

9. Tim Hale Home Bias – Global Style Tilts 4 Portfolio

Asset class	Asset allocation	Fund name	OCF
Domestic equity	9%	Vanguard FTSE UK Equity Index	0.15%12
Domestic small value	6%	Aberforth UK Small Companies	0.85%
Developed world	15%	Vanguard FTSE Dev World ex-UK Equity Index	0.3%
Developed world small cap	6%	Vanguard Global Small-Cap Index Fund	0.4%
Developed world value	6%	Vanguard FTSE All-World High Dividend Yield ETF	0.29%
Emerging markets	6%	BlackRock Emerging Markets Equity Tracker D	0.28%
Commodities	6%	ETF Thomson Reuters/Jefferies CRB Ex-Energy TR	0.35%
Property	6%	BlackRock Global Property Securities Equity Tracker D	0.28%
Government bonds (Gilts)	15%	Vanguard UK Government Bond Index	0.15%
Government bonds (Index-linked)	25%	Vanguard UK Inflation-Linked Gilt Index	0.15%13

This is the one portfolio designed from the ground up for UK investors. Hence it’s more internationally diversified. US investors are more than happy to keep most of their chips at home in the world’s number one economic powerhouse.

There is certainly no need to devise a portfolio more comprehensive and complex than this one – a multi-fund portfolio like this can get costly if you’re paying dealing charges.

Hale originally allocated a distinct 3% to domestic small cap and another 3% to domestic value. You can use the options cited in the Coffeehouse portfolio if you want to stick to that prescription.

However, in a departure from my usual passive investing orthodoxy, I’ve thrown in an active investing wild card with Aberforth UK Smaller Companies.

This is a small value fund that’s not terribly expensive, fulfils Hale’s brief, and that I personally use. The truth is that small value funds are active management plays anyway and there’s no law against passive investors using active funds when there are no better alternatives. The Aberforth fund is available as a Unit Trust and an Investment Trust.

Intriguingly, the portfolio includes a wedge of commodities. Hale, like Larry Swedroe (but unlike William Bernstein), believes that commodities have a place in an investor’s portfolio.

Hale thinks that commodities offer diversification value because they are uncorrelated to bonds and equities. Hype and poor predicted returns are why many of the US passive commentators steer clear of commodities.

More Britisher snags with this low-cost take on Hale:

• The global small-cap fund is inc UK, not ex-UK. It increases small cap exposure a little beyond that intended by the designer.

• It is possible to exclude the UK by choosing separate US, Euro, and Asian small-cap ETFs. Though it’s too fiddly and expensive to do for my taste.

•  The All-World High Yield ETF substitutes for world ex-UK value. Again it includes UK, so exposure comments above apply.

Vanguard funds feature heavily in this piece because they are an excellent fund house that have blazed a low-cost trail in the UK. For some alternative choices take a look at the UK’s cheapest trackers and Monevator’s very own Slow and Steady portfolio.

Take it steady,

The Accumulator

1. Caveat: Sometimes it’s the only choice available, given the paucity of the UK market! [↩]
2. plus 0.5% initial charge [↩]
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Good reads from around the Web.

I was woken this week at 2am by a Metropolitan police helicopter circling overhead. Quite annoying, considering what a feat it was to get to sleep in the first place in the heatwave.

Fear not, dear reader! The fuzz wasn’t about to rappel into my garden, kick down my back door, and bust open my piggy bank on suspicion of my having stashed an undeclared and surprisingly tiny Russian oligarch in there.

No, the helicopter was in pursuit of a stolen vehicle, as well as searching “nearby open spaces” for one of the thieves who’d bailed.

I know this because of MPSintheSky, the improbably named Twitter account where London’s airborne finest report what they’re up to.

And it’s surprisingly effective. The Twitter account, I mean.

Before Twitter, these helicopters circling overhead had seemed one step from the capital becoming a Mega City One of Judge Dredd’s worst nightmare.

But when you read that a human being is up there looking for a missing person or even a mugger, it’s easier to fall snugly unconscious again.

Where did all the criminals go?

Do the Met’s choppers also cut crime? I’ve no idea, but it’s possible – because something has.

In another stick in the eye for grumpy 50-something middle-class men who think everything has gone to pot – many of whom read Monevator, so I stress my baiting is in their own best interest – crime has been sharply falling across the Western world for years.

Check out this illustration from The Economist this week:

Crime has crashed, with the exception of homicide, where I presume a majority of victims know their murderer, and hence you’ll probably learn as much from Shakespeare as you will from CrimeWatch.

Bump offs aside, nobody is quite sure what’s caused the incidence of other crimes to fall so far, so fast, particularly in the UK – and that gives everyone a chance to ride their own hobbyhorses.

The Economist runs through the laundry list, from better policing and improved private security to an aging population, more young people in education, wider access to abortion, and more prisoners behind bars.

Strangely it doesn’t make much of the long economic boom that proceeded the bust in the UK. Nor does it really delve into New Labour’s redistribution efforts, which even I think is worth a nod.

I don’t really have an investing angle, I just thought the graphic was pretty stark. If you can think of a way to make money from the trend then let us all know below.

[continue reading…]

Warning: This is one of my occasional articles on active investing. Most people – perhaps even me, when the counting is done – will be better off using index trackers. Just read this piece for “fun”, the same way you’d read an article on space travel or robot surgery.

The price of gold has been falling faster than you can say “Fiscal Armageddon”.

And believe me – gold bugs can say “Fiscal Armageddon” pretty quickly.

From its peak of $1,913 in August 2011, the price of an ounce of gold has approached $1,200 in the past few months. That’s a drop of more than 30%. As I write it’s recovered to around $1,280, but who knows what will happen next.

My belief remains that with no yield and few practical uses, gold is basically impossible to value. Paradoxically, I now believe this is one of the reasons why it can make a good portfolio diversifier.

Logically or not, gold is also considered good to hold during a crisis. So it’s probably worth having some before the next crisis rolls around, if only to sell it to someone who believes that it’s useful – even if you’d rather have a shotgun and a tin of spam in a tight spot yourself.

Preciousness about metals

Over the years I’ve developed a grudging respect for asset allocations that acknowledge this sort of investing realpolitik, such as The Permanent Portfolio, the gold-heavy asset allocation that enjoyed a renaissance with the yellow metal’s return to favor.

It all adds up me envisaging a future where I hold 3-5% of my portfolio in gold.

Now that might not seem very controversial, but to a gold bug – and a relatively reasonable gold bug at that – it counts as “ambivalence and antipathy” and adds up to a “monumental blind spot”, according to his comments the last time I wrote about gold.

This commentator advocated going 100% long in gold, which might sound crazy, but was probably only enough to get a seat by the toilets at the annual Gold Bugs Bash. (I don’t think he mentioned Bernanke or the “global conspiracy” once. Poor show!)

Bottom line: Gold is weird stuff, the price behaves oddly, and it brings out strange beliefs in otherwise seemingly sane people.

For me it adds up to a reason to hold some gold, but carefully and ideally somewhere where I don’t look at it much. We’ve all seen the effects of cradling a ‘precious’ metal in The Lord of the Rings.

Nobody wants to be a gold Gollum!

Mining value

So am I building up my modest position in gold then? Err, not yet.

My account with Bullion Vault has spare cash in it ready for deployment, but I’m dithering. I really do hate buying the stuff.

I’ll probably bite the bullet sooner rather than later with a small purchase, but what I’m slightly more interested in currently are gold miners.

As the stock market has continued to rise, I’ve seen some of my unloved holdings such as UK house builders and commercial property come back into fashion. While I’ve strenuously attempted not to sell everything to soon as usual, my focus is shifting more to what’s next rather than what’s already delivered.

That means finding stuff that’s cheap and unloved. And that’s almost the definition of the mining sector these days, especially at the smaller company end.

Gold mining’s fall from grace has been spectacular. But even the best commodity companies are notorious for getting cheaper and cheaper when the environment is against them, so you rush into declining gold miners at your peril.

It’s all to do with the hard-to-value nature of their assets.

For all that precious metal diehards argue about fiat money and unsustainable consumer spending and the rest of it, the fact is that the price of a box of Persil or even of 23 Acacia Avenue doesn’t change much from month-to-month, or even year-to-year.

Sure you get broad trends, but by comparison commodity price changes can make them look about as speedy as a glacier pausing for a breather.

These volatile prices are tricky if you’re a miner. What you sell is whatever you dig up, and hedging aside, you get what the market will pay you for it. Apple can try to jazz up its fortunes with a new graphical user interface, say, but there’s not much innovation in a lump of iron ore.

Worse, mining costs are pretty sticky, too. It takes a lot of work to set up a mine. It takes a lot of energy to operate them, and unless you have your own power source on site (such as a hydroelectric generator) then the cost of all that energy is out of your hands, too.

Then there are labour costs.

In most of the world, mining is hot, dangerous, fairly wasteful, and very labour intensive. It takes a lot of people to work most mines, and they’re the sort of people who tend to get the hump if you don’t pay them or fire them. They aren’t afraid to show it with a violent protest or two.

Who can blame them, as often they’re pretty poor. In many countries, they also have politicians who are willing to back them in a scrap with foreign-owned extraction firms, too.

Leveraged misery

One consequence of all this is that mining companies are usually said to be geared or leveraged plays on the underlying commodity. Because their operational costs are fixed, their resultant profits – or losses – can be hugely magnified as commodity prices fluctuate.

Consider the simplified example of Mr Micawber-Miner, who can produce 100,000 units of some particular commodity a year.

• Fixed costs £1 million. Commodity priced at £15 a unit. Result £500,000 profit a year! And happiness.

• What if the commodity price fell to £10 a unit? Then there’s no profit. Result, misery.

• And if the commodity price fell to £8? Result: Potentially bankruptcy.

It’s this mathematics that also makes debt and mining such a noxious combination, by the way.

Cash flow can be great in mining companies (though in the boom times a lot of it goes back into capital expenditure) so interest payments are usually pretty easy to cover from profits. The trouble is as I’ve just shown there’s already leverage built into the operations of the company, without magnifying that leverage with debt.

Things can get ugly quickly.

Canaries in the gold mines

All this makes buying mining companies at least as difficult buying the commodity itself.

The big integrated miners such as BHP Billiton or Rio Tinto have the breadth and depth to soften some of the blows for you by changing their focus (although they can’t escape the costs and the writedowns from doing so) but small cap miners can and do go to the wall like flies to sticky blue death paper when prices move persistently against them.

At this point another quote from The Lord of the Rings may comes to mind, this time from Gimli the Dwarf.

Gimli quips:

“Certainty of death. Small chance of success. What are we waiting for?”

He’d love the small cap mining sector right now.

While gold bugs have been struggling to understand why the gold price is falling when most of their bugbears – US national debt, money printing, Europe in crisis – remain in play, over-optimistic followers of small cap gold miners have endured a longer and even more painful wake-up call.

The graph below plots the US Market Vectors gold miners ETF (Ticker: GDX) against the major US gold price tracking ETFs (Ticker: IAU):

What this graph shows you is that in the years immediately following the nadir of the financial crisis in late 2008, the price of gold and the stock market value of gold miners tracked each other pretty closely – shown by the lines moving up together.

This progression in tandem was already a bad sign for gold miners. Remember, they are a meant to be a leveraged play on the gold price – so their share prices should have risen much faster as the price of the commodity rose.

At the time people blamed this on the rising costs of mining and poor cash control by management for scaring away would-be investors. But in retrospect it looks like gold mining investors were accurately predicting a fall in the price of the metal, by bidding down the price of miners.

This isn’t so fanciful if – like me – you believe that the ease of buying gold through an ETF is one factor that drove the price so high in the first place.

I think savvier money was likely in (or rather getting out of) the miners than in the gold ETFs.

Anyway, around the start of 2012 things got much worse for the gold miners. Their share prices, as captured in aggregate by the GDX ETF, began to tumble. As you can see from the graph the gold price only really caught up with the pace of this decline at the start of 2013.

Some of the falls have been dramatic. The gold miners ETF is down 60% from mid-2011, but flakier individual mining companies – those with little cash or too much debt or a focus on exploration or in dodgy countries – have lost much more.

A discount or a value trap?

Huge share price falls, near panic among the weaker holders, and likely forced liquidation from indebted commodity funds caught on the wrong side of the trade? This sort of car crash gets a wannabe value investor’s pulses racing.

The time to buy is when people are fearful, ideally. You then sell when people get their appetite back. This sentiment cycle is fairly obvious in most sectors – the tricky bit is getting the timing right.

For a cyclical sector like mining, you can lose a lot of money extremely quickly if you buy too soon. And you can forego a lot of profit if you sell too early.

So is now the time to buy into gold miners? I’m not fully convinced, but some of the signs are good.

The following graph shows how sharply the price-to-book ratio of gold miners has fallen – from over 2x in 2011 to under 1x now.

Source: Datastream / Hargreaves Lansdown

In simple terms, what this means is that purchasers were prepared to spend £2 for every £1 of a gold miner’s assets (which should principally be gold, but in some cases will be accounting nonsense like goodwill) in 2011.

But now they’ll only buy at a discounted price – about 95p for every £1 of assets, according to this graph.

As you can see this is the first time the price-to-book value has fallen below 1x since 1980. Surely an amazing opportunity to buy cheap?

Not so fast!

As we’ve all noted from countless gold-promoting articles over the years, the turn of the 1980s marked the end of the last bull market for gold. Prices of the metal yinged and yanged for 20 years, but the general direction was down, down, down until the turn of the century.

If that sort of fall is about to happen again, then the £1 of assets you’re buying with your 95p might be worth say 70p in a few year’s time. Not such a bargain, in that case.

This second graph shows that book values – the green line – hasn’t really budged even as the price of gold miners has plunged.

Source: Datastream / Hargreaves Lansdown

I was sent these two graphs by Hargreaves Lansdown, and I get the impression their analyst thinks this latter graph is a bullish sign.

However I think it’s potentially a negative, in that it probably shows that mining company’s book values are yet to catch up with the reality of a lower gold price.

Cautiously creeping into gold and other commodities

This is already a very long article, and I haven’t even gone into the big issue with gold miners, which is the all-in ‘cash cost’ of getting gold out of the ground.

Briefly, there are deep gold mines around the world where workers toil to crush 3-4 tons of rock just to get one ounce of gold. This is just as expensive (and philosophically pointless) as it sounds. With oil prices rising and a falling gold price, these mines will quickly become uneconomical.

Industry experts seem to consistently argue that $1,250 is around the breakeven cost of production for the gold mining industry as a whole.

If this is true – and to be honest it’s a pretty dubious number, given the price of gold was far lower just a few years ago – then an optimist might say we’re approaching some sort of fundamental value for gold (not me, really, given I don’t believe it can be valued).

But a pessimist might worry that a lot of miners are about to go bust when the price falls further!

So what am I doing? Not much so far.

I’ve not yet stocked up on my Bullion Vault gold horde, and only the very biggest gold mining companies look at all sensible for individual stock picks. (Newmont Mining in the US is one I may research further).

I have had a nibble though of a long established commodities investment trust, City Natural Resources High Yield Trust (Ticker: CYN).

It’s only partly a play on gold (roughly 20% of assets) but much of what I’ve written above applies to the commodity sector as a whole currently, so I’m buying a little bit on that wider theme, too. The trust pays a dividend, which is good if you have to wait a long time for a recovery, and its focus on income means it should be more invested in producing assets (and in some cases debt) rather than on blue sky exploration outfits.

Note that the name of the trust – “High Yield” – is not indicative of the dividend yield on offer. Even after its share price has fallen well over 50% from its highs, the yield is still just 3.6%.

The “High Yield” in the name is a clue that commodities used to be a stodgier sector when this trust was set up, not the go-go sector of much of the past decade. We could well get there again, with gold but also with many of the other commodities that rode the super-cycle story.

Hence I’m cautiously buying a bit, but no heroics.