Recently, I started reviewing how the price of gold has evolved over the past 20 years, and honestly, the numbers are quite impressive. It’s currently around $4,270 per ounce, but if you look back, in 2005 it was just over $400. That means it has multiplied more than ten times in two decades. That’s no ordinary growth.

What’s interesting is that this growth hasn’t been linear. There were specific periods where the metal really took off. Between 2005 and 2010, for example, it was a brutal appreciation phase. The weakness of the dollar, the subprime mortgage crisis, Lehman Brothers’ bankruptcy in 2008... all of that pushed the price from $430 to over $1,200. It was the moment when central banks and institutional funds started accumulating gold like never before.

Then came a calmer period between 2010 and 2015. The market stabilized, the economy began to recover, and gold moved sideways between $1,000 and $1,200. It was more a technical stage than a structural one, with no major movements but also no loss of its hedging function.

What happened afterward changed everything. Between 2015 and 2020, gold shined again. The trade tensions between the United States and China, rising public debt, historically low interest rates... all of that rekindled demand. And when the pandemic hit in 2020, the metal became the ultimate safe haven. It surpassed $2,000 for the first time in history.

But the most spectacular came afterward. Between 2020 and now, the price of gold over the last 20 years has reached levels that seemed science fiction. From $1,900, we jumped to over $4,200, a 124% increase in just five years. Looking from 2015, we’re talking about a nearly 295% appreciation in nominal terms.

Now, what surprises me most is that this translates into an annualized return of between 7% and 8% over the last decade. For an asset that doesn’t generate dividends or interest, that’s quite remarkable. It’s true that there has been volatility, corrections in 2018 and 2021 where the metal stagnated while stocks kept rising, but when inflation reappeared and interest rates fell, gold revived again.

If you compare this with the S&P 500 or the Nasdaq, the numbers are revealing. In the long run, the Nasdaq remains the big winner with cumulative returns over 5,000%, but here’s the interesting part: in the last five years, gold has outperformed both the S&P 500 and the Nasdaq-100. That’s uncommon over such extended periods and says a lot about the environment we’re in.

What I find crucial is the risk profile. In 2008, when stocks plummeted more than 30%, gold only retreated 2%. In 2020, when uncertainty paralyzed markets, it again acted as a refuge. That’s no coincidence; it’s its nature.

The factors behind all this are several. Negative real interest rates have been decisive. When real bond yields fall, gold appreciates because it becomes more attractive. The dollar also plays an important role, as gold is traded in dollars, so when the US currency weakens, the metal tends to rise. Inflation and massive public spending programs have also rekindled inflation fears. And we can’t forget geopolitical tensions, conflicts, trade sanctions. All of this has motivated central banks in emerging countries to increase their gold reserves as a way to diversify and reduce dependence on the dollar.

For those considering investing, gold shouldn’t be seen as a speculative asset but as a stability tool. The typical recommendation is to keep between 5% and 10% of your wealth in physical gold, ETFs backed by metal, or funds that replicate its behavior. In portfolios heavily exposed to equities, that percentage acts as insurance against volatility.

What I value most about gold is its universal liquidity. In any market, at any time, you can convert it into cash without suffering the swings of debt or capital restrictions. In times of financial uncertainty or monetary tensions, that feature becomes especially valuable.

Ultimately, the gold price over the last 20 years reflects something deeper than numbers. It reflects trust. When this erodes—due to inflation, debt, politics, or war—gold returns to the center stage. It’s not a substitute for growth nor a promise of quick wealth. It’s a silent insurance that appreciates when other assets falter. For those building a balanced portfolio, it remains an essential piece of the global financial puzzle.