Gold: the most effective commodity investment
Posted on 11/30/2020
Gold: not your typical commodity
Gold is the most effective commodity investment, yet it is under-invested
Gold allocations of 2%-10% in a typical pension portfolio have provided better risk-adjusted returns than those with broad-based commodity allocations.
Investors have long recognised the benefits of investing in commodities. Over time, they have been shown to improve portfolio risk-adjusted returns, offering diversification, inflation protection and an element ofsmoothing across economic cycles.
Most investors access this asset class via commodity indices, which invariably include gold.