What can gold do (or not do) for your portfolio On one level, the rationale for investing in gold is pretty simple: you invest in gold because there’s an opportunity to make money. Well, sure. But your portfolio allocation decisions should be more strategic than that, and express broader goals and ambitions beyond simply becoming richer. Ideally, there should be specific reasons why allocating to a certain asset class makes sense for you, and specific objectives which you’re looking to accomplish by adding that asset to your portfolio. Fortunately, there are several reasons why including an allocation to gold (or perhaps to other precious metals) might make sense. Such as: Low correlation with other assets – Perhaps the most compelling reason to invest in gold is because of how “detached” the performance of gold is from the performance of other assets. The following chart gives you a glimpse of what we mean – the price of gold often moves independently of (or even inversely to) the stock market. This basic feature of how gold can smooth out disappointing performance in other investments makes a pretty compelling argument for including at least a small allocation to gold in your portfolio, particularly when volatility in traditional assets such as stocks, bonds and real estate seems to be the order of the day. -20% 30% 20% 10% 0% -10% -30% 2000 2004 2008 2012 2016 2020 2024 Annual returns S&P 500* *Including dividends Annual returns gold Finance Average annual returns S&P 500 versus Gold Chart data: Investopedia, TradingView CSANews | FALL 2025 | 29
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