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Gold as a Strategic Asset Allocation

Is Gold an Institutional Asset Class of its Own?

Gold is frequently referred to as an inflation hedge, but what are the merits of these claims?  Should asset allocators re-examine the possibility of holding gold as a strategic allocation? 

Amundi Asset Management looks at the specific case for gold allocations within central bank reserve portfolios, especially considering the interest in diversifying away from dollar-dominated reserve allocations and into additional currencies and alternative assets.  The World Gold Council also discusses some of the fundamental roles that gold can play in a portfolio context.  

gold dilemma


Gold in central banks' asset allocation (Amundi AM, Mar 2019)

Amundi Asset Management develops a model to examine whether gold provides enough benefits to central bank reserve portfolios to justify an allocation. Their answer is a resounding 'yes,' predominantly due to its limited correlation with fixed income assets.

Gold as a Strategic Asset in 2019 (World Gold Council blog, Mar 2019)

For compliance reasons, this paper is only accessible in certain geographies

The authors describe in detail the four fundamental roles that gold can play in a portfolio and examine the potential risk/return benefit that would accrue to a pension fund portfolio upon increasing their gold allocation.

Is gold really a hedge against inflation? (DWS AM, July 2017)

For compliance reasons, this paper is only accessible in certain geographies

DWS AM argue that historical correlations don’t support that theory that gold is an inflation hedge, but instead suggest that it could be a hedge against declining growth expectations.

Who Wins and Who Loses, if Gold Keeps Rising? (Axioma blog, Mar 2019)

In this blog post, Axioma's Diana R. Rudean, PhD, examines who the likely winners (and losers) are if gold continues to rise, and equities fall in a 'risk-off' environment. 

The Case for Gold as a Strategic Allocation (State Street Global Advisors blog, May 2018)

State Street Global Advisors presents the case for gold as a core diversifying asset with a long term strategic role in portfolios.

Gold - has it lost its shine? (LGIM blog, Sep 2018)

For compliance reasons, this paper is NOT accessible in the United States and Canada

Does gold merit a place amongst the holdings of institutional portfolios? LGIM investigates this question, given volatility in gold prices in 2018.

Gold 2048 - The Next 30 Years for Gold (World Gold Council, 2018)

For compliance reasons, this paper is only accessible in certain geographies

This paper reviews long term demographic and economic trends, emerging market demand and supply dynamics, the gold mining industry, and gold's usage in the jewellery and technology industries in order to provide a picture of the likely evolution of the gold market over the next three decades.

The Golden Dilemma - investing in Gold (2013)

Gold, for many investors, has only recently become a viable tradable asset despite having been described as the "golden constant” and used as an inflation hedge for thousands of years. But the real price of gold is high, historically, so care should be taken.

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