Precious Metals And Retirement Portfolio Survival Rates

Recent gains in the value of gold bullion in the presence of declines in the stock and corporate bond markets suggest that retired investors may benefit from holdings of precious metals. Because of the comparative liquidity and economy of holding mutual fund shares, we examine the effect of an optim...

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Bibliographic Details
Published in:Journal of business & economics research (Littleton, Colo.) Colo.), 2010-12, Vol.8 (2), p.107
Main Authors: Hubbard, Carl M., Walz, Daniel T.
Format: Article
Language:English
Subjects:
Asset allocation
Bond markets
Coins
Comparative analysis
Corporate bonds
Diversification
Equity
Futures
Gold mines & mining
Impact analysis
Metals
Mutual funds
Portfolio investments
Portfolio management
Portfolio performance
Precious metals
Rates of return
Retirement
Scandals
Securities markets
Silver
Silver mines
Stock exchanges
Stock prices
Studies
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Summary:Recent gains in the value of gold bullion in the presence of declines in the stock and corporate bond markets suggest that retired investors may benefit from holdings of precious metals. Because of the comparative liquidity and economy of holding mutual fund shares, we examine the effect of an optimal allocation of precious metals funds shares on portfolio survival rates through payout periods of 15, 20, 25, 30, and 35 years using returns data from September 1988 through December 2008. Since most of the higher withdrawal rates that are supported by precious metals funds are ill-advised, adding precious metals fund shares to a conventional stocks and bonds portfolio does not appear to benefit most retired investors. The findings do support greater allocations to bonds rather than stocks.
ISSN:1542-4448
2157-8893
DOI:10.19030/jber.v8i2.678