Gold: an asset with no income and a particular role
· beginner
Automated material · TradeAlmanac editorial deskDraft prepared by a language model from our stored data; not reviewed by an editor.
Gold produces nothing and pays no current income. The only source of a result is a change in its price.
Why people hold it anyway
For behaviour weakly linked to equities in certain periods. In moments of severe stress gold often rises while almost everything else falls.
{{figure:correlation|caption=A portfolio of assets that behave differently fluctuates less than any of them separately}}
That is a contribution to a portfolio's resilience rather than to its return — Diversification: what it gives and what it does not.
What not to expect from gold
Reliable inflation protection over any horizon: the link exists but is unstable, and in some decades it failed entirely.
Rising "because there is a crisis": the reaction to a crisis varies, and in the first days of a panic gold sometimes falls with everything else — it gets sold to meet demands on other positions.
How to hold it
An exchange-traded fund, an unallocated metal account or physical metal — each with different costs and different risks: Gold funds: how they differ from the metal.
What weight
A modest one. An asset with no cash flow cannot be the base of a portfolio: it has no internal source of growth, only revaluation.
Related: Commodity markets: why access is harder than it looks.
Related instruments
Draft prepared by a language model from our stored data; not reviewed by an editor.
Model: claude-opus-5
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