Meketa Investment Group explores whether gold deserves a permanent role in institutional portfolios, focusing on its behavior across inflation regimes, real yields, and market stress. The paper challenges the reliability of historical inflation hedging and argues gold’s diversification benefits may be more structural than cyclical, especially during systemic shocks.
Gold As A Strategic Allocation
Meketa
Alison Adams
Research
16 Pages
Key Takeaways
Low Equity Correlation: Gold’s long-term correlation to equities has hovered near 0.0, with some periods turning negative during crises like 2008, enhancing diversification when traditional assets fall.
Real Yield Sensitivity: Gold prices show an inverse relationship with real yields, with declining rates historically coinciding with stronger performance, particularly during periods when real yields fall below 0%.
Crisis Hedge Behavior During major drawdowns, gold has delivered positive returns in several stress periods, including gains of over 20% in certain crisis windows while equities declined sharply.
Join our newsletter to have all of this content + Exclusive Newsletter Bonus Content delivered to your inbox every week
