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Chart of the Day: Investing in Gold

Bar graph comparing the S&P 500, MSCI World and Gold returns.

Contents

Today's Chart of the Day from the New York Post article "Bullish or Bearish on Bullion? How to think about gold investing in 2024" shows the risk-reward tradeoff of gold compared to other asset classes.

While gold is often viewed as a "stable" haven, the data shows it has actually been more volatile than both U.S. stocks and international securities. Even more surprising, gold investors historically haven't been rewarded for taking on that added risk, with annualized returns of just 6% over the 50-year period starting in 1973.

This chart is a reminder of how important it is for investors to always assess price volatility, stay well diversified, and weigh long-term risk and return expectations rather than relying on assumptions about "safe" investments.