WGC Underscores Gold’s Role as a Key Strategic Portfolio Asset
Gold | 2026-02-05 10:30:19
Market participants note that gold remains a natural complement to stocks and bonds, especially as traditional asset relationships evolve.
By Paul Ploumis
SEATTLE (Scrap Monster): Gold continues to reinforce its status as a strategic portfolio asset, supported by high liquidity, scarcity, and the absence of credit risk, said a new release by the World Gold Council (WGC).
As no one’s liability, gold has historically preserved value over time and benefits from diversified demand across investment, central bank reserves, jewellery, and technology applications. These attributes allow gold to strengthen portfolios in three key ways: delivering long-term returns, improving diversification, and providing dependable liquidity.
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Market participants note that gold remains a natural complement to stocks and bonds, especially as traditional asset relationships evolve. Rising inflation in recent years has weakened the historic balancing role of bonds, as correlations with equities have increased. By contrast, gold has demonstrated resilience across market cycles, generating positive long-term returns during both economic expansions and periods of stress.
Gold’s demand structure further supports its performance. During times of uncertainty, counter-cyclical investment demand typically drives prices higher, while during economic growth phases, pro-cyclical consumer demand from jewellery and technology underpins returns.
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Should investors increase gold exposure amid rising inflation and market volatility?
Frequently Asked Questions
- Why does the WGC consider gold a strategic portfolio asset?
Gold offers high liquidity, no credit risk, and long-term value preservation, supported by diversified global demand.
- How does gold complement stocks and bonds?
Gold improves portfolio diversification and liquidity, especially as correlations between stocks and bonds have increased in recent years.
- What drives gold demand across economic cycles?
Investment demand rises during uncertainty, while jewellery and technology demand supports performance during economic growth.
