Selling into Strength

Continuing my recent theme of selling some of my holdings into strength and in the process, redefining my portfolio, I took advantage of today's gold rally to sell my Agnico-Eagle shares.


Agnico jumped 9.67% today as gold jumped 2% (according to Kitco). I still believe that Agnico is a great company and has excellent prospects going forward but it's another one of those stocks that has had a huge jump since hitting a low of $36.68 on August 16th; that almost 39% in three weeks!

By selling these shares, I have reduced my precious metals exposure. This might not be the brightest move as gold and silver tends to perform best at this time of year. That being said, I still hold Goldcorp and Silver Wheaton; both of which, had good days, as well today.

I intend to utilize the cash from this transaction to finance a future investment that will help diversify the assets in my stock portfolio.

Showtime for Gold Stocks?

Based on stories I've heard recently, gold apparently starts rallying during the summer months (typically in August) on a historical basis. Is it possible that gold mining stocks are finally going to start recovering?

One of my two gold mining stocks, Agnico-Eagle Mines (AEM-T), appears to have recently reversed its uptrend as illustrated in the chart below.


The second gold mining stock in my portfolio is Goldcorp (G-T). As you can see from the chart below, it hasn't convincingly broken out of its downtrend just yet


Although AEM looks tempting, I doubt I'll place any additional funds in these two gold stocks as I've had more success investing in other sectors. I believe every portfolio should have exposure to gold just in case the gold bugs are right but at this point in time, I am comfortable with my portfolio's weighting in gold. I see these two stocks as long-term holds and expect that they will be taken over one day. That being said, I might invest in another gold stock if I see an opportunity for a quick gain.

Kitco currently has a bid / ask price for gold of 652.50 / 654.00.