Jim Rogers' First Rule of Investing

Get educated. Choose real assets like gold or silver. But first...
 
ON BEHALF of BullionVault customers who sent me their questions to put to Jim Rogers, writes Miguel Perez-Santalla, I asked him last night what advice he'd give someone trying to build or protect their portfolio as 2014 begins.
 
"Everybody's gotta make that decision for themselves," Jim Rogers replied, urging US and other investors to educate themselves.
"If you cannot spell gold you should not own any gold until you learn something about it. If you can't find Europe on a map you shouldn't think about investing in Europe until you know something about it."
Then, and only once "you've done your homework and know where you're going," says Jim Rogers, "the first rule is you should have some of your assets outside of your country."
 
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Speaking to New York Markets Live on Wednesday, Jim Rogers said:
"Everybody should have some of their assets outside of their own country, whatever their own country is as an insurance policy if nothing else.
 
"Everybody has life insurance, fire insurance, health insurance, car insurance, and you hope you never use your health insurance policy, you hope you lose money on it. Well that's the same thing about having some of your assets outside your own country. You hope you never need it, but it is terribly good insurance. Because every country in world has had economic upheavals at one time or another.
 
"Then everybody should have some real assets. [Held overseas] they are a very good safeguard. Whatever kind of safeguard you've got, whether it's gold, silver, farmland, silos full of rice, everyone should have some kind of assets that will come through an economic upheaval."
Not everyone can access farmland or grain for investing directly, however. So how does Jim Rogers see silver investing compared to gold?
"If I had to buy one rather than the other today, I'd buy silver because it certainly has gone down more than gold. Gold is down what, 30-35%. Silver is down 60% from its all-time high. So on a historic priced-basis if nothing else, I'd rather own silver."
However, Jim Rogers stressed again that "I'm not buying either. I do own both. I have hedged a little of my gold, but I haven't hedged my silver. Because it's already gone down so far.
"But that doesn't mean silver cannot go down [from here].
 
"If gold goes to $1000 or $950" – and that's only on "if" as Jim Rogers was also keen to repeat – "then silver's gonna go down, too."
So, Jim Rogers' take on silver and gold investing overall right now?
"If it goes down more, I hope I'm smart enough to buy."

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Vice president of business development for BullionVault from 2012 to 2014, Miguel Perez-Santalla is a fierce advocate for retail investors, and a regular speaker at industry and media events. With over 30 years' experience in the precious metals business, Miguel has worked at the United States' top coin dealerships, as well as international refining group Heraeus.

See the full archive of Miguel Perez-Santalla articles. Or visit his personal blog and postings via Miguel Perez-Santalla on Google+

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