Bull markets tend go through vicious corrections along their way to the top, and the bucking bull wants to take as few people along for the ride as possible. For many investors, when confronted with volatility and steep corrections, the emotional side of investing takes over and the investor panics and then sells. Even the larger more sophisticated traders, who move in and out of gold, in their attempt to beat the market, often trade themselves out of their positions as the bull rages on.
Look closely at the 10 year graph of gold, above. You will see several steep corrections along the way, especially since 2006. This is one reason that gold, physically held in your possession, has an advantage to most other forms of investments. Selling back gold coins, while easy to do, does take some effort. It is not as easy as just clicking sell on your online brokerage account. Selling back coins involves securely packing them up, and then sending them to a dealer by registered and insured mail, or hauling them across town to a local dealer. This is a big reason that gold investors are not as tempted to sell their coins on every decline or correction. People even get attached to their beautiful gold coins. I know, I am. Then, when the correction is over and gold turns around and heads higher, the coin-holders remain in the game with a tight grip around the bulls riding rope, while the emotional investors who sold their positions with a click of the mouse, are now out of the game and wondering what to do.
The best way to ride the bucking bull market to the top is simply to buy bullion coins, add to your position on corrections and hold on tight as you can to that riding rope. And get longer gold!