The transformation of gold: twenty years of unparalleled revaluation

The Remarkable Rise of a Millenary Asset

In October 2025, gold is trading around $4,270 per ounce, reaching consecutive all-time highs throughout the year. To put this movement into perspective, remember that two decades ago it was barely around $400, and just a decade ago it was close to $1,100. In just twenty years, its price has multiplied more than tenfold, representing an accumulated growth of nearly 900%.

But what is truly noteworthy is not just this absolute figure. Over the past decade, gold has generated an annualized return of between 7% and 8%, an extraordinary figure for an asset that does not pay dividends or generate periodic interest. Its ability to appreciate during turbulent times is what has positioned it as an indispensable defensive tool in any balanced portfolio.

Gold in the Last Decade: When Numbers Speak for Themselves

Between 2015 and 2025, gold’s evolution has been nothing short of spectacular. Starting from values just above $1,000 per ounce a decade ago, it has reached figures exceeding $4,200 today, representing a nominal appreciation of approximately +295%. Translated into a compounded annual growth rate, this results in annual gains of about 7% to 8%, depending on the methodology and starting point considered.

What makes this analysis interesting is that these gains have been achieved in a context marked by substantial volatility. The metal has gone through periods of lateral consolidation and significant corrections. In 2018 and 2021, for example, it experienced stagnation phases while stock indices continued to climb. However, when inflation resurged strongly and interest rates fell to historic lows, gold shone brightly once again.

Gold versus Stock Markets: Who Really Won?

Comparing gold with the main stock indices is revealing. The Nasdaq-100 remains the big winner of these twenty years, with returns exceeding 5,000%. The S&P 500, for its part, has accumulated gains close to 800%. Gold, on the other hand, is positioned around +146% according to standardized metrics, though it hovers near +850% if considering nominal value since 2005.

However, there is a data point that deserves special attention: in the last five years, gold has outperformed both the S&P 500 and the Nasdaq-100 in cumulative returns, a phenomenon rarely seen over broad time horizons. This behavior reinforces the thesis that in scenarios of high inflation or reduced interest rates, precious metals tend to stand out above conventional risk assets.

Nevertheless, what is truly relevant goes beyond the final return: risk profile makes the difference. In 2008, while stock markets fell more than 30%, gold barely retreated 2%. Similarly, in 2020, when uncertainty paralyzed global markets, the metal once again fulfilled its role as a capital refuge. These precedents demonstrate that gold has offered returns comparable or superior to major US indices, but with significantly lower volatility, especially in environments of low interest rates, geopolitical tensions, and economic slowdown.

The Deep Reasons Behind This Sustained Evolution

Gold’s performance over twenty years can be attributed to a combination of economic, monetary, and psychological forces that have converged in a unique way:

Negative real interest rates: Gold tends to appreciate when real yields on bonds (discounted for inflation) are negative. Quantitative easing policies implemented by the Federal Reserve and the European Central Bank have significantly compressed real yields over the last decade, channeling capital into precious metals.

Relative weakening of the dollar: Since gold is valued in US dollars, a weak currency tends to favor its price. Periods of dollar depreciation, particularly after 2020, have coincided precisely with the most pronounced upward phases of the metal.

Persistent inflation and expansive fiscal spending: Massive stimulus programs during the pandemic rekindled long-lasting inflation fears. When inflation remains high, investors seek to safeguard their purchasing power, and gold benefits directly from this search for protection.

Growing geopolitical instability: Regional conflicts, international trade tensions, and changes in global energy dynamics have reinforced safe-haven demand. Simultaneously, central banks of emerging economies have actively increased their gold reserves as a mechanism to reduce dependence on the US dollar and diversify their assets.

Gold in a Portfolio: The Key Piece of Balance

For the contemporary investor, gold should not be viewed as a speculative asset but as a strategic instrument of stability and preservation. Its primary function is not to generate spectacular returns but to safeguard the real value of wealth against unforeseen market events.

Professional financial advising generally suggests maintaining an exposure of between 5% and 10% of total assets in gold, whether in physical form, through ETFs backed by the metal, or funds that replicate its behavior. In portfolios heavily concentrated in equities, this percentage serves a similar purpose as insurance against volatility spikes.

Gold also possesses another distinctive feature: practically universal liquidity. In any market worldwide, at any time, it can be converted into cash without experiencing the typical fluctuations of debt securities or restrictions on capital movements. During periods of financial instability or international monetary tensions, this capacity becomes invaluable.

Final Reflection: Gold as Certainty in Times of Uncertainty

Gold remains an unavoidable benchmark in the global financial ecosystems. Its appreciation does not depend on corporate dividends or company balance sheet performance but on something more fundamental: investors’ confidence in the system. When that confidence erodes—due to inflationary pressures, debt accumulation, political volatility, or international conflicts—the metal reclaims its place at the market’s epicenter.

Over the last decade, gold has demonstrated its ability to compete directly with major stock indices; in the last five years, it has even surpassed them. This phenomenon is not by chance: investors are desperately seeking stability in a world that offers less and less of it. Gold does not aim to replace economic growth nor serve as a gateway to rapid wealth. It is simply a silent shield that appreciates precisely when other shaky assets lose their footing.

For those building long-term portfolios, gold remains, as it was two decades ago, an essential and irreplaceable component of long-term financial balance.