Gold in your portfolio: insurance against the world’s folly?
Published on 2026-11-10
Why gold is more than just a shiny piece of metal for Swiss private investors. And why its real strength lies not in its return, but in diversification.
There are asset classes that regularly pay out dividends or interest. And then there is gold. It pays nothing, produces nothing and does not even send out invitations to annual general meetings. And yet, for millennia, it has been one of the world’s most sought-after assets. What may seem contradictory at first glance has a perfectly rational explanation: gold is less a traditional investment seeking returns and more a strategic component for stabilising an investment portfolio.
What happened in 2026?
The price of gold in 2026 is a fairly good illustration of the fact that even ‘safe havens’ can experience turbulence: at the start of the year, gold hit a new record high of just under 5,600 USD per ounce. Most recently, it was trading between 3,900 and 4,100 USD – around 30 per cent below its peak. Anyone who bought at the very top has received a free lesson in humility this year. Free, but not cheap. What is interesting, however, is who did what during this phase: According to the World Gold Council, central banks purchased around 321 tonnes of gold in the third quarter of 2026, 42 per cent more than in the same quarter of the previous year. Retail investors, on the other hand, moved in the opposite direction: demand for bars and coins fell by 19 per cent to 267.8 tonnes, whilst gold-backed securities saw a 6 per cent decline.
So the professionals are buying on a structural basis, whilst the general public is pulling back after the recent surge. This is not a contradiction: central banks have an investment horizon spanning decades and aim to make their reserves less dependent on the US dollar.
Retail investors, on the other hand, are watching the price, and they are currently less keen on it. Anyone wishing to interpret such reports correctly must distinguish between these two levels.
The real strength: diversification rather than promises of returns
The greatest benefit of gold does not lie in outperforming the stock market. Rather, its strength lies in its interaction with other asset classes. A traditional investment portfolio often consists of shares, bonds and cash. Each of these asset classes fulfils a specific function:
Shares provide long-term growth and allow investors to participate in economic development.
Bonds provide (currently low) interest and can reduce a portfolio’s volatility.
Cash ensures short-term solvency and provides room for manoeuvre.
Gold complements this structure as a tangible asset and a component of diversification.
This last point in particular is crucial. Over the long term, gold exhibits a comparatively low correlation with many traditional asset classes. This means that it does not necessarily move in lockstep with shares or bonds. This finding, which is broadly supported by empirical evidence, can be put to good use in personal investing.
How much gold should be included in a Swiss investor’s portfolio?
There is no one-size-fits-all answer. As a strategic allocation, I consider a proportion of around 5 to 10 per cent of investable assets to be a sensible guideline. One could break this down as follows:
Conservative risk profile: 5–8 per cent
Balanced risk profile: 5–10 per cent
Aggressive risk profile: 5–10 per cent
These ranges are guidelines and not universally applicable recommendations. The specific allocation depends, amongst other things, on the equity allocation, the investment horizon, liquidity planning and other tangible assets. For example, if a portfolio already has a high proportion of property, a different weighting may be appropriate compared with a securities portfolio consisting almost exclusively of shares and bonds.
It is also important not to equate gold with other precious metals or gold mining shares. Gold mining companies are PLCs and entail additional corporate, cost and market risks. They therefore do not fulfil the same function as physical gold.
For Swiss investors, there is another important consideration: the Swiss franc. Gold is predominantly traded internationally in US dollars. Swiss investors who invest in a gold product that is not currency-hedged therefore bear not only the actual gold price risk but also an exchange rate risk. A rising gold price in dollars does not automatically mean an equally high return.
My conclusion on financial planning
Gold is neither an insider tip nor a panacea. It is a building block that soothes the nerves at the right moments and tests one’s patience at the wrong ones. The current pullback following the record high is not an argument against gold, but rather an excellent argument against exaggerated expectations. Central banks continue to buy, geopolitics provides talking points, and the price does as it pleases. This is precisely why gold belongs as a complement to a broadly diversified portfolio, not at its core.
This article is for general information purposes only and does not constitute individual investment, tax or legal advice. The prices and figures quoted are taken from reports by broker-test.de (citing, amongst others, the World Gold Council) dated 3 and 6–7 November 2026 and are subject to rapid change. Investments in gold are subject to price fluctuations.