Two crises, unprecedented central bank intervention and deep and prolonged recessions, followed by a brittle recovery have left the global economy facing a complex inflation/deflation paradox. For many developing economies, high inflation is an ongoing reality, while the threat of protracted low growth, low inflation or even deflation looms over developed markets, fuelling uncertainty for investors and savers.
The World Gold Council has therefore commissioned Oxford Economics to conduct this independent, proprietary research using their respected Global Model, to explore the performance of gold and other assets in various economic situations and examine gold’s role within in an efficient investment portfolio in divergent economic scenarios.
This independent analysis confirms that gold is an important portfolio building block and shows that gold’s share of an optimal medium-risk investor’s portfolio is around 5% and upwards, depending on the future inflation scenario.
The Oxford Economics study makes a valuable contribution towards the World Gold Council’s own body of investment research, supporting the findings from recent reports on market risk on Gold as a Tail Risk Hedge and investment risk, in the recent study Gold: a commodity like no other.