Adens: A Shift from Bonds to Metals

05/23/2016 9:00 am EST

Focus: ETFs

Mary Anne & Pamela Aden

Co-Editors, The Aden Forecast

In a major change in their portfolio strategy, Mary Anne and Pamela Aden, editors of The Aden Forecast, now recommend selling bonds and putting the proceeds into metals related investments.

We now recommend selling your 20% position in long-term US government bonds and/or the bond ETFs. Use these proceeds to buy more gold, silver and gold shares, buying some now and some later.

This will raise our metals sector exposure from 30% to 50% of our total portfolio. Keep the other 50% in cash.

Use half of this cash (25%) to buy and hold the euro and Australian dollar, or their ETFs — the Euro ETF (FXE) and the Australian Dollar ETF (FXA). Buy the Canadian dollar or the Canadian Dollar ETF (FXC) with 15% of your cash position on weakness.

And keep 10% in the US dollar for now to be used to buy new profitable investments when the time comes.

The US dollar index is now clearly bearish and it’s headed lower. That is, the currency markets are embarking on new bull markets and they’re set to rise further.

Meanwhile, we would like to take our time and buy new metals positions on weakness. If you buy now and plan to hold for the coming bull market, it means you’ll probably ride through weakness for now.

We definitely want to buy gold when weakness finally arrives. Our core positions include Sprott Gold Miners (SGDM), Gold Miners ETF (GDX) and SPDR Gold Trust (GLD).

We’re also now adding platinum to our recommended list but like the others, wait to buy on weakness. We recommend the Platinum ETF (PPLT).

Silver is looking good; it’s clearly in breakout mode, and it’s now ready to see how well it passes the upcoming hurdles while the bull market grows. Our core silver positions include iShares Silver Trust (SLV).

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By Mary Anne and Pamela Aden, Editors of The Aden Forecast

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