Transcript
Gold just beat the S&P 500—again. Here’s what 54 years of data really says about where your money works harder.
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Additional Resources
How to Earn Passive Income in Gold and Silver
Transcript
Ben Nadelstein
Gold versus the S&P 500. Today, we’re tackling one of the biggest investment questions, how does investing in gold compare to investing in the S&P 500? This debate has raged for decades, and 2024 has only added fuel to that debate fire. Gold ended the year up 27%, outperforming the S&P 500’s impressive 25% total return. And in early 2025, gold is continuing its rally, beating all time highs, breaking past that $3,000 per ounce mark while stocks are showing some early declines. Is this a new trend where both gold prices and stocks both outperform, breaking 25% returns in the same year, or was 24, just an anomaly. Let’s dive into the data and find out. We analyzed 54 years of historical data, comparing the price performance for both assets. Here are some of the key takeaways that we found in the data. Gold outperformed the S&P 500 in 23 out of 54 years, just under half the time. When gold did outperform, it did so by an impressive average of 28. 8 8%. During years when the S&P 500 had negative returns, gold outperformed eight out of nine times, averaging a 19. 4% return compared to the S&P 500’s negative 15 14.
Ben Nadelstein
3%. The S&P 500, to its credit, had superior returns in 31 out of 54 years, with its strongest periods occurring in the 1980s, the 1990s, and the 2010s. The data that we analyze suggested that gold was not only a good asset for diversification, but was also an excellent option during periods of stock market volatility or economic uncertainty. But what about going beyond just price returns? Well, we did that, too. We analyzed risk factors like volatility and compound annual growth rates to compare the two investments on something more than just price returns. So what did we find? Well, gold had a historical compound annual growth rate of 8. 19% compared to 11. 52% for the S&P 500. What does that mean? It means that $100 invested in gold in 1971 would be worth about $7,000 today. While the same $100 invested into the S&P 500 would now be worth over $36,000 today. What about volatility? Well, gold’s average volatility was 26. 9% over this period, compared to just 16% for the S&P 500. However, in recent decades, the risk profiles of both of these assets have converged. But what about other risks? Well, gold has one major advantage over stocks when it comes to the risk of default, mainly that gold just can’t default.
Ben Nadelstein
Unlike individual companies that comprise the S&P 500 Index, gold is a commodity, so it doesn’t go bankrupt. That’s why many investors have historically turned to gold as a hedge against financial turmoil and rising bankruptcies. But what about gold historically having a major drawback that it doesn’t generate income? Well, it turns out that is no longer the case. And monetary metals, we enable gold owners to lease or loan their gold to businesses in exchange for a return paid in ounces of gold. That means you can earn a yield on gold paid in gold, just like earning interest on cash or dividends from stocks. Here’s how adding yield changes the picture for gold. Adding just a 3% annual yield, which is below our current lease rates, boosts a $100 gold investment in 1971 to over $33,000 today, nearly closing the gap with the S&P 500’s $36,000. The original data analysis that we did didn’t account for gold’s ability to generate income. But when you do factor in a yield on gold paid in gold, gold’s performance significantly improves, making it a stronger competitor to the S&P 500. Now, remember, leasing gold gives gold owners the ability to benefit from both gold’s price appreciation and ongoing income.
Ben Nadelstein
Of course, as with any investment that has a return, there are risks. We encourage investors who are interested to head to our website, monetary-metals. Com, to learn more about how they can earn a yield on gold paid in gold. What does all this data really say at the end of the day? Well, gold and the S&P 500 have each had a winning streak. But 2024 and early 2025 have shown us that gold continues to play an important role in diversification. So if you’re looking to enhance your gold by earning a yield on gold paid in gold, check out our gold yield marketplace by heading to monetary-metals. Com. If you’d like to hear our price predictions for gold in 2025, click the link in the description below to get our 2025 Gold Outlook report sent straight to your inbox. Thanks for watching. And by the way, be sure to like, subscribe, hit that little notification bell so you never miss an update. And why don’t you leave a comment in this video? Tell us what you’d like us to cover next. Thanks so much. And don’t forget to head to monetary-metals.com to learn more.
