How to view the trend of the Golden Decade | Predicting the next ten years based on the pattern of gold price fluctuations

Gold, Is It Really Worth Investing?

When it comes to investing, many people ask: Is gold really a good target? To answer this question, we need to look at gold’s performance over the past half-century.

Since the US dollar was decoupled from gold in 1971, international gold prices have risen from $35 per ounce to a historic high in 2025, an increase of over 120 times. During the same period, the Dow Jones Industrial Average also rose from around 900 points to approximately 46,000 points, an increase of about 51 times. At first glance, gold’s performance seems more impressive, but a closer look at the data from the past 30 years shows that stock returns have actually outperformed.

What does this tell us? The returns from gold investment mainly come from price differences, not dividends. To make money from gold, the key is to grasp the market cycle—knowing when to enter a wave trading position and when to avoid risks.

Four Major Bullish Cycles of Gold Over the Past Decade

To understand the investment logic of gold, we must first understand its historical context.

1970—1975: The First Wave of Rise

After the dollar was decoupled from gold, international gold prices soared from $35 to $183, a rise of over 400% in five years. The logic behind this surge was simple—investors’ confidence in the dollar wavered, prompting a shift to gold as a safe haven. Coupled with the oil crisis, gold prices were driven to fever pitch. However, as the oil crisis eased and confidence in the dollar gradually recovered, gold prices retreated to around $100.

1976—1980: The Second Wave of Rise

The second Middle East oil crisis and geopolitical turmoil (Iran hostage crisis, Soviet invasion of Afghanistan, etc.) again pushed gold prices upward. Gold broke through $104 to reach $850, an increase of over 700%, but this rally was also short-lived. Once the crises subsided, gold prices quickly fell back, oscillating between $200 and $300 over the next 20 years. Investors who entered during this period saw little to no gains.

2001—2011: The Third Wave of Rise

From $260 to $1921, over 700% increase in ten years. This rally was triggered by the 9/11 attacks, leading the US to launch a global anti-terror war, with massive military spending causing the US government to keep lowering interest rates and issuing bonds. Subsequently, the housing bubble burst, and the 2008 financial crisis erupted. The Federal Reserve launched QE again, causing gold to surge. Only after the European debt crisis did gold prices stabilize around $1000.

2015 to Present: The Fourth Wave of Rise

This phase saw a dramatic increase in gold prices. Starting from $1060, driven by negative interest rate policies in Japan and Europe, global de-dollarization, the Fed’s frantic QE in 2020, the Russia-Ukraine war, Middle Eastern tensions, and other catalysts, gold steadily climbed above $2000.

In 2024, gold performed even more spectacularly—gaining over 104% for the year, with prices briefly surpassing $2800 per ounce in October. Entering 2025, gold continued to hit new highs, breaking through $4300, setting an unprecedented peak.

The drivers of this rally include: US economic policy risks, central banks increasing gold reserves, Middle Eastern crises, escalation of Russia-Ukraine conflict, US tariffs and trade worries, and the continued weakening of the US dollar index.

The Investment Logic Behind the Past Decade of Gold Trends

By examining these four cycles, we can observe a pattern: Gold’s rise often stems from geopolitical turmoil, economic crises, or easing monetary policies.

More importantly, although gold’s upward movement isn’t smooth, each low point after a decline has been gradually higher— the lows in 1980 are much higher than those in 1975, and the lows after 2011 are higher than those after 2001. This indicates that, in the long run, gold does have a hedging function and won’t keep falling to worthless levels.

Because of this, gold is more suitable for swing trading rather than simple long-term holding. If you bought in 2000 and held until now, you would have made money, but how many people can wait 50 years? Instead of waiting patiently, it’s more efficient to enter during each bullish cycle, short or reduce positions during sharp declines, and seize opportunities for higher returns.

Comparing Gold, Stocks, and Bonds

Different assets have different sources of returns, and their investment difficulty varies:

• Gold: Returns come from price differences, no interest income, requiring precise timing of entry and exit
• Bonds: Returns come from interest payments, requiring tracking of central bank policies, with relatively low difficulty
• Stocks: Returns come from corporate growth, requiring stock-picking skills and long-term vision, with the highest difficulty

Over the past 50 years, gold has performed the best. But in the last 30 years, stocks have yielded higher returns. This reflects an investment truth: During economic growth, allocate to stocks; during recessions, shift to gold.

A more prudent approach is to set reasonable allocations of stocks, bonds, and gold based on your risk profile and investment goals. When the economy is booming, corporate profits are promising, and stocks tend to rise; during downturns, gold’s hedging function and bonds’ fixed income become more attractive.

How to Invest in Gold? Five Methods Fully Explained

Method 1: Physical Gold

Buying gold bars or jewelry directly. Advantages include asset concealment and wearable use; disadvantages are inconvenience in trading and poor liquidity.

Method 2: Gold Certificates

Holding gold certificates through banks. Advantages are portability; disadvantages include no interest, large bid-ask spreads, suitable mainly for long-term investment.

Method 3: Gold ETFs

Purchasing gold ETF funds, offering better liquidity and easier trading. Disadvantages are management fees charged by issuers, and if gold prices stay stagnant, the value slowly erodes.

Method 4: Gold Futures

Margin trading with low transaction costs and support for both long and short positions. Suitable for experienced investors to conduct medium-term swing trading.

Method 5: Gold CFDs

This is the most common tool for retail investors. Compared to futures, CFDs are more flexible, with higher capital efficiency, small account requirements, and especially suitable for small investors. The T+0 trading mechanism allows you to enter and exit at any time; supports both long and short positions, providing profit opportunities whether gold prices rise or fall.

Future Outlook for the Past Decade of Gold

Will gold continue its bullish trend over the next 50 years? It depends on the global economic situation.

Current main factors influencing gold prices include: central banks increasing gold reserves, de-dollarization trends, geopolitical risks, monetary policy directions, etc. As long as these factors persist, gold’s safe-haven value will be reassessed.

But the core point of investing in gold is: Don’t expect it to rise immediately after purchase; learn to switch between bullish and bearish operations. Historical data clearly shows that gold has periods of ascent, correction, and volatility. Seizing the upward phases and taking profits at high points is the correct approach to gold investing.

In summary, facing unpredictable markets and unforeseen events, holding a reasonable proportion of stocks, bonds, and gold can effectively hedge risks and make your investment portfolio more resilient. The future of gold over the next decade may not exactly mirror the past, but its fundamental value for preservation and hedging will remain unchanged.