Source: forbes
By: Trefis Team
Date: Aug 18, 2025
When markets decline, most investment portfolios find it challenging to safeguard their value – except, historically, gold. We examine the 10 worst months for the S&P 500 since 2015, and gold outperformed stocks every single time, frequently showing positive returns while stocks were deep in the negative. A simple adjustment – allocating merely 10% of a portfolio to gold – would have mitigated losses in each of these downturns, all while having a minimal effect on your long-term alpha. Related – Why Don’t Advisors Add 10% Gold to Client Accounts?
- Gold was positive in 5 out of the 10 worst months for the SPDR S&P 500 exchange traded fund (SPY)
- Even when gold showed negative returns, it typically declined much less than SPY
- In severe crash months such as March 2020 (Covid-19 panic), gold experienced minimal change (-0.2%) while SPY dropped (-12.5%).
- If you allocated 10% of your equity to gold, the excess return would have consistently ranged between +0.6% and +1.5% compared to SPY. That type of buffer is very encouraging.
Wealth preservation is fundamental to our mission. Trefis collaborates with Empirical Asset Management – a wealth manager based in the Boston area – whose asset allocation strategies produced positive returns during the 2008-09 period when the S&P declined by over 40%. Empirical has integrated the Trefis HQ Portfolio within this asset allocation framework to offer clients improved returns with reduced risk compared to the benchmark index; resulting in a smoother investment experience, as shown in HQ Portfolio performance metrics.
If a 10% allocation to gold can mitigate equity downturns without impacting long-term returns, envision the possibilities when you incorporate multiple uncorrelated assets. Think about the potential long-term performance for your portfolio if you blended 10% commodities, 10% gold, and 2% crypto with equities?
