Financial experts recommend a 5 to 10 percent gold allocation in every investor portfolio, since adding the precious metal improves a portfolio's risk-adjusted return and provides diversification other asset classes cannot match to the same degree. Over the last 20 years, gold has also proven to be a strong return driver, with performance that has clearly outpaced stocks and bonds – with one single exception: in 2013, it saw a correction of –30 percent.
Whether over 5, 10, or 20 years: gold outperformed other asset classes
In a recent comparison, the analysis platform justETF Research benchmarked gold's performance between the start of 2006 and the end of 2025 against global equity baskets* and government bonds. Over the last 5 years, the gold price in the eurozone recorded an increase of 18.41 percent per year, while stocks gained only 12.86 percent and bonds lost 2.84 percent. Gold also came out ahead over 10 years: 13.7 percent per year compared with 11.1 percent for stocks and 0.2 percent for bonds. The 20-year comparison tells a similar story: gold gained 10.75 percent annually, stocks 8.34 percent, and bonds 2.99 percent.
Key drivers behind the price pullback: 2013 vs. 2026
In 2013, the end of the financial crisis, expectations of tighter US monetary policy, and fading inflation fears were responsible for the 30 percent gold price correction. Today, different factors are holding the gold price back despite unresolved geopolitical crises and looming inflation: expectations of rising key interest rates – which make alternatives to gold more attractive – and a stronger US dollar, which weighs on gold and makes it less attractive to investors outside the US. However, both factors are likely to be short- to medium-term in nature, so gold's current sideways trend is unlikely to continue indefinitely.
* Specifically, the MSCI World Total Return Index from 1970 to 2004, and the iShares MSCI World UCITS ETF from 2005 to 2025.