By Editor-in-Chief, Timothy Gocklin, MBA, MSF
Gold’s Meteoric Rise in 2025: Why Everyone Wants In
April 22, 2025
It’s been a year of global uncertainty, inflation fears, and political instability, but one asset has outperformed them all: gold. The yellow metal hasn’t just held its own — it has crushed all the major asset classes, from stocks and bonds to even Bitcoin.
As of April 2025, gold has reached an all-time high of $3,500 per troy ounce, a whopping 31% year-to-date gain. This is not a flash-in-the-pan rally, but part of a much broader trend with central banks, institutional investors, and individuals all scrambling for a slice of the world’s oldest safe-haven asset.
🌟 Gold’s Record High: A Beacon of Hope in the Gloom
Gold’s run in 2025 has caught even seasoned investors off guard. At its recent peak of $3,500 an ounce, gold has appreciated over 30% this year alone. Over a 20-year timeframe, the SPDR Gold Shares ETF (GLD) is up 630%, outpacing the S&P 500 by over 85 percentage points — something that has astonished equity purists who consider productive businesses to be superior to inert metals.
This performance has prompted a broader question: if gold is outperforming everything else, what’s really driving the demand?
🌪️ A Perfect Storm of Demand
1. Central Bank Accumulation
One of the most apparent drivers of this record rally is central bank gold buying. Since 2022, countries like China have actively loaded up on bullion, especially after U.S.-led sanctions on Russia. Although China’s pace has slowed, other central banks have joined the party, suggesting a broader trend of diversifying out of the U.S. dollar. In 2000, over 70% of foreign reserves were in dollars; today it’s closer to 57%.
As a result, global gold holdings are now estimated at:
- $4 trillion by central banks
- $5 trillion by private investors
This amounts to a record 3.5% of all global financial assets, a notable milestone in modern investment history.
2. Retail Demand Soars
Gold bars and coins are moving off the shelves, with some dealers reporting sporadic shortages. Demand is not only institutional. Private investors, worried about inflation, rising debt, and geopolitical conflict, are buying gold as insurance.
3. ETF Inflows Return
After a muted 2023, gold ETFs like SPDR Gold Shares (GLD) and iShares Gold Trust (IAU) are back in the reckoning. Flows restarted definitively positive in mid-2024 and have picked up momentum, especially in Asia. RBC Capital Markets says if volatility continues, ETF demand would be the next powerful growth engine for gold.
🧨 Behind the Fear, What?
- Tariffs and Trump’s Return
One of the biggest incentives to invest due to fear is Donald Trump’s re-election as president. His aggressive tariff policies and open criticism of the Federal Reserve have provoked concern about economic direction and dollar stability. - Soaring U.S. Debt
The U.S. has record deficits. Investors are turning more and more to gold as a hedge against fiat currency debasement, especially with worries that fiscal irresponsibility will at some time in the future ignite inflation or credit downgrades. - Geopolitical Risk
Eastern European, Middle Eastern, and African tensions continue to rattle markets. With every fresh headline, gold becomes more attractive as a long-term store of value.
🧠 Expert Views: Should You Buy?
Russ Koesterich, BlackRock
Koesterich, portfolio manager for BlackRock’s iShares Gold Trust, believes gold belongs in the portfolio:
“Gold has proven to be a store of value and deserves a 2% to 4% allocation for most investors. Pullbacks may be a buying opportunity, particularly for those with no exposure.”
Chris Louney, RBC Capital Markets
“Gold is the asset of last resort — the corner of the investing world that people turn to when they have lots of questions elsewhere.”
Daniel Major, UBS
UBS increased its 2026 gold price target by 23% to $3,500 — prior to the recent price surge. Major expects further earnings revisions across the gold mining industry and favors stocks like Barrick Gold, Newmont, and Endeavour Mining.
⛏️ Don’t Forget the Miners
Gold has rallied and gold miners have underperformed, creating what some consider a golden buying opportunity. For example:
- Newmont is down 20% over the last three years.
- Barrick Gold is down 8%, hampered by conflict in Mali.
- Endeavour Mining is up 40%, but with heightened jurisdictional risk in West Africa.
UBS believes the worst is behind the industry. Major expects improving free cash flow, more conservative management, and attractive valuations. These stocks could be next in line to rally if gold prices remain elevated.
⚖️ A Reality Check: Gold Is Not Perfect
In spite of the optimism, financial planners are counselling caution. Gold is not:
- A perfect inflation hedge: In 2022, when US inflation was 9%, gold went nowhere.
- A reliable stock hedge: When the tariff-driven selloff in early April 2025 dropped stocks 11%, gold dropped nearly 5% as investors sold it to cover losses elsewhere.
Gold is volatile, reactive, and doesn’t pay income. It’s not a bond, nor is it a dividend stock. It’s an emotional asset, and that’s both its weakness and its strength.
💡 Smarter Ways to Own Gold
If you want to participate in the gold rally, your choices are:
1. ETFs
- GLD (SPDR Gold Shares): Most popular, charges 0.40%
- IAU (iShares Gold Trust): Slightly cheaper, charges 0.25%
- IAUM (iShares Gold Trust Micro): Cheapest, only 0.09%
2. Physical Bullion
- Coins: Gold American Eagles, Maple Leafs, Krugerrands
- Bars: Swiss 1-ounce bars (Costco sells these, typically limits 2 per member/day)
🛒 Expect markups of 2% to 4% and add storage and insurance when calculating costs.
3. Mining Stocks
- Higher risk, higher reward
- At the mercy of company performance, geopolitical risk, and commodity cycles
🔬 The Chemistry of Gold’s Appeal
Gold’s allure is part psychology, part chemistry. It:
- Doesn’t corrode or tarnish
- Is malleable enough to shape
- Can’t be synthesized (except in a nuclear reactor)
- Retains value across civilizations — from King Tut’s tomb to the Federal Reserve
Gold is rare, beautiful, and symbolic — and that gives it staying power that transcends spreadsheets.
🧭 Final Thoughts: Is Now the Time?
Gold’s 2025 performance has been unquestionably strong, but should you invest at these levels? That depends.
If you have no exposure to gold, a modest allocation (2%–4%) may bring long-term diversification, say experts. But don’t expect too much from it. Use it as one component of an overall strategy that includes:
- Stocks (for growth)
- Bonds (for income)
- Real assets (for inflation protection)
- Patience (for everything else)
Gold is beating everything else right now — but no investment wins forever. Buy gold with your eyes open wide, not for its glamour, but because it serves a valuable, long-term purpose in your portfolio.
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