Jump to content
Create New...

Gold vs. Actions: The Reversion Trade Barely Started – 4x High Potential Only to Return to Crisis Peaks

🎧
Analista ExpertFX

ExpertFX Podcast -
No time to read? Let me read it for you. Press Play!


Igor Pereira
 Share

Recommended Posts

  • ANALISTA

Good afternoon, traders and members Premium.

While the nominal price of gold records, many wonder if it is too late to enter. The answer, based on relative valuation, is a sound NO.

By Igor Pereira, Financial Market Analyst, Junior Member WallStreet NYSE

A crucial graph of Incrementum AG compares the total value of the gold market with the total value of the US stock market. The conclusion is shocking: in relation to stocks, gold is still cheap, and the real "reverse trade" has barely begun.

Gold vs. Actions: The Reversion Trade Barely Started – 4x High Potential Only to Return to Crisis Peaks - ExpertFX School


1. The Graph of Truth: Gold vs. US Actions

The chart shows the proportion between the gold market capitalization and the US stock market capitalization since 1925.

  • The Historical Median: The red dashed line marks the long-term median of 37.9%.

  • The Current Level: We are. below the median, which means that gold is undervalued in relation to shares, even after the recent discharge.

  • The Crisis Potential: In previous crises (Great Depression, 1970/80 Stagflation, 2008/11 Financial Crisis), this relationship not only returned to the median, but it shot to 160% or more.

My Analysis (Igor Pereira): In order for this relationship to return to previous peaks of crisis (which is likely given the debt and Fed situation), gold would have to value massively in relation to the shares – potentially multiplying its value by 4x in relative terms.

2. The Thesis of Media Reversion

Markets are cyclical. After a long period of dominance of shares (impelled by QE and low interest), we are entering an era of dominance of real assets.

  • Actions in the Bubble: As we saw in the Buffett Indicator, the shares are in a historical bubble.

  • Gold at Start: Gold is just beginning to come out of a long period of relative undervalue.


Conclusion of Igor Pereira: It's not too late

This graph proves that the bull market gold is not a bubble; it is a standardisation. We're coming out of an extreme undervalue.

If history serves as a guide, the "reversion to average" will lead gold to dramatically overcome actions in the coming years.


Want to take your analysis to the institutional level?

This analysis is just the tip of the iceberg. ExpertFX School Premium Members Receive daily insights, premium analysis in-depth and Direct access to our closed group on Telegram, where we discuss the market in real time.

Don't operate on noise. Operate based on intelligence.

Access your dashboard and become Premium now: https://expertfxschool.com/dashboard

💬 Did you like this content? Your feedback is very important!
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Terminal Visitor
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

TRADING HUB
● MARKET OPEN
Loading...
RETAILS SENTIMENT
INVERSE
  • Loading...


×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use of Use and Privacy Policy

Search In
  • More options...
Find results that contain...
Find results in...

Write what you are looking for and press enter or click the search icon to begin your search

Enjoying ExpertFX? 📈
Your review helps our community grow. Rate the app in seconds.