Gold is the best performing major asset class of the millennium thus far
Gold is the best performing major asset class of the millennium thus far.
The price of gold is making news again, and seems to be reaching top of mind for not just asset managers and institutional investors as well as Central Banks. The everyday investor, the hard working individuals who've seen their modest wealth eroded by rising inflation are beginning to pay attention.
We've been backing gold for a long time, since starting in the industry in 2005, it's been clear that having some portion of an investment portfolio in gold makes sense. As stated at the top of this post, gold is the best performing major asset class of the millennium so far.
Gold's Performance 2005-25
2005 ($426.80) to 2010 ($1113.00): Significant Growth (161%)
This dramatic surge reflects the aftermath of the 2008 global financial crisis. During this period, gold’s appeal as a safe-haven asset soared, driven by economic uncertainty, financial instability, and the Federal Reserve’s expansionary monetary policies (e.g., quantitative easing). Investors flocked to gold as a hedge against inflation and currency devaluation.
2010 ($1113.00) to 2015 ($1184.25): Modest Increase (6%)
The slower growth in this phase can be attributed to a stabilisation in global economic conditions after the financial crisis. As equity markets rebounded and central banks signaled tightening policies, gold saw less dramatic appreciation. Nonetheless, its value held relatively steady, demonstrating resilience.
2015 ($1184.25) to 2020 ($1520.55): Renewed Momentum (28%)
This period saw renewed interest in gold, driven by geopolitical uncertainties (e.g., trade tensions between the US and China) and the Federal Reserve’s rate cuts in response to slowing economic growth. The COVID-19 pandemic in 2020 further propelled gold prices, as investors sought safe-haven assets amidst unprecedented global disruptions.
2020 ($1520.55) to 2025 ($2644.60): Substantial Surge (74%)
In recent years, gold’s price increase reflects a confluence of factors:
Persistent inflationary pressures eroding fiat currency value.
Fears of economic downturns, such as the anticipated US recession in early 2025 and growing geopolitical risks, including tariff disputes and other uncertainties. Gold’s all-time high of over $3,000/oz last week, highlights its critical role as a hedge against both immediate and long-term risks.