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Oops I got my GFC date wrong by about 10 years haha. Sorry about...

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Gibson68

222 Posts.

279

07/12/21

11:26

Post #: 58124693
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Originally posted by Gibson68: ↑

Below is a chart that tracks the price of gold against the S&P 500 since Oct 2018 (GFC) until now (gold is the blue line and the S&P is the orange line). I think this is interesting as we have had a few significant events in that time and we can hopefully learn from history. Key takeaways for me:

When the GFC hit in Oct 2018, the S&P500 dropped 20% before making a recovery. Gold steadily increased. If you had invested into gold at that point, it wouldn't be until late June 2021 that the S&P 500 finally caught up.
When the markets dropped due to covid in Feb/Mar 2020, the S&P 500 dropped 34% but gold also dropped 12.4%

So is gold a safe haven asset? The GFC experience would indicate yes, but the covid experience would indicate not necessarily. Whilst you were better off in gold vs the stock market at that time, cash is still king.

I find myself in a bit of a quandry. I have a gut feel that there is going to be a significant downturn soon. But is it better to just cash up or go into gold? An interesting dilemma.

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Oops I got my GFC date wrong by about 10 years haha. Sorry about that. But looking at the GFC period, gold still dropped around 30% vs the S&P500 about 60%. Gold doesn't appear to be safe in turbulent times but recovers quicker
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0 Great analysis

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