SSGA’s Maxwell Gold On Gold’s Role As A Risk Management Tool

Maxwell Gold, Head of Gold Strategy, State Street Global Advisors joined Keith Black, Managing Director, RIA Channel to discuss gold’s role as a core risk management portfolio tool. 

A long-term allocation to gold has the potential to reduce overall portfolio volatility, deliver diversification benefits, and improve risk-adjusted returns. Historically, investors have turned to gold as a hedge against unforeseen market events, tail risks, or inflation. Unlike traditional asset classes, “Gold is not really in a portfolio to drive top line returns or provide yield or cashflows. It’s there as a risk management tool to dial up or dial down,” explains Gold on gold’s unique value proposition.
When compared to other commodities sectors like oil, gas, and industrial metals, precious metals tend to be more countercyclical in nature, explains Gold, pointing to gold’s lower price volatility and the potential for outperformance in times of global slowdowns and recessionary periods. 

While some have positioned crypto currencies as a new kind of digital gold, Gold says, “It’s not really an apples-to-apples comparison.” Gold’s centuries-long track record as a store of value, its real-world utility, and its role in the portfolio are key differentiators.  

Looking ahead, Gold cites the softening strength of the US dollar, rising recession risk, and increasing demand for gold as key performance drivers in 2023.  

For more insights on this topic:

SSGA’s 2023 Gold Outlook

White Paper: Invest in Gold

Investing in Gold with ETFs

Research: Gold as a Strategic Asset Class

The information provided does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your tax and financial advisor.

Commodities and commodity-index linked securities may be affected by changes in overall market movements, changes in interest rates, and other factors such as weather, disease, embargoes, or political and regulatory developments, as well as trading activity of speculators and arbitrageurs in the underlying commodities.


Exp. Date: 12/31/2023