Gold has increased over 120 times in 50 years | Can the epic upward trend continue? The correct approach to investing in gold prices

Gold has been a symbol of wealth from ancient times to the present. It features characteristics such as high density, strong ductility, and excellent durability, making it suitable not only as currency in circulation but also for jewelry and industrial applications. Over the past half-century, gold prices have experienced multiple fluctuations but overall show a strong upward trend, even reaching new highs in 2025. Will this 50-year upward cycle repeat in the next 50 years? How has the 10-year performance of the gold price chart been? Should gold be considered a long-term asset allocation or a trading tool for swings?

Half a Century of Surge: 120x Increase｜The Epic of Gold from $35 to $4,300

In August 1971, U.S. President Nixon announced the detachment of the dollar from gold, officially ending the Bretton Woods system. This decision marked a dramatic change in the international financial landscape. Before that, gold was fixed at $35 per ounce; today, spot gold surged to $4,300 per ounce in October 2025, meaning gold has increased over 120 times in more than 50 years.

The performance since 2024 has been particularly astonishing. Turbulent global situations, central banks increasing reserves, and geopolitical tensions have combined to push gold prices up over 104% within a year, setting new records. Entering 2025, escalating Middle East tensions, increased Russia-Ukraine conflicts, U.S. tariff policies sparking trade concerns, and stock market volatility have all contributed to gold repeatedly hitting new highs.

Compared to the stock market performance during the same period: the Dow Jones Index rose from around 900 points to approximately 46,000 points, a gain of about 51 times. Over a 50-year horizon, the actual returns of gold are comparable to, or even surpass, those of stocks.

10-Year Gold Price Chart: Four Major Bullish Waves｜Historical Patterns of Bull and Corrections

Analyzing historical price trends, there are four distinct upward phases over the past 50 years:

First Wave (1970-1975): Confidence Crisis in the Dollar

After the dollar was decoupled from gold, panic ensued. People feared the dollar would become worthless and preferred holding gold. Coupled with the oil crisis, the U.S. printed money wildly, causing gold prices to soar from $35 to $183, an increase of over 400%. As the oil crisis eased and confidence in the dollar gradually recovered, gold prices retreated to around $100.

Second Wave (1976-1980): Geopolitical Shocks

The Iran hostage crisis, Soviet invasion of Afghanistan, and the second Middle East oil crisis drove global inflation higher. Gold surged from $104 to $850, an increase of over 700%. However, after the peak, crises eased, and with the dissolution of the Soviet Union, gold prices quickly fell back, fluctuating between $200 and $300 for the next 20 years.

Third Wave (2001-2011): A Decade of Bull Market

The 9/11 terrorist attacks awakened global alertness, triggering a decade of U.S. anti-terrorism wars. To fund these, the Federal Reserve cut interest rates and issued debt, boosting housing prices, followed by rate hikes that triggered the 2008 financial crisis. The Fed’s QE measures rescued the markets, leading to a 10-year bull run in gold. During the European debt crisis in 2011, gold peaked at $1921 per ounce.

Fourth Wave (2015-Present): A New Decade Cycle

Japan and Europe adopted negative interest rate policies, and global de-dollarization was underway. In 2020, the U.S. launched aggressive QE; in 2022, the Russia-Ukraine war; in 2023, conflicts in Israel-Palestine and the Red Sea crisis… Over these ten years, gold has maintained above $2000. The 10-year gold price chart from 2024-2025 hitting new highs is even more impressive, soaring from $2690 to $4300, a gain of over 56%.

Is Gold a Good Investment?｜Depends on Benchmark and Time Horizon

Over the past 50 years, gold increased 120 times versus the 51 times of the Dow, slightly outperforming. However, looking at the last 30 years, stock returns have been better, with bonds trailing behind.

The key point: Gold prices do not rise in a straight line. Between 1980 and 2000, over 20 years, gold hovered between $200 and $300, yielding no significant gains for investors. How many 50-year periods are there in life to wait?

Therefore, gold is more suitable for trend swing trading rather than simple long-term holding. Its operational pattern is: a bullish cycle → rapid correction → steady accumulation → restart of the bull. Capturing the bull for long positions or the correction for shorting can generate returns far exceeding bonds and stocks.

Another hidden pattern is: each bottom of a decline is higher than the previous one. This is because the costs and difficulty of gold mining increase over time. Even when a bullish cycle ends, the decline does not crash but oscillates on a higher platform.

Five Ways to Invest in Gold｜Choose the Trading Tool That Fits You

1. Physical Gold
Directly buy gold bars or jewelry. Advantages include asset concealment and both preservation and aesthetic value; disadvantages are poor liquidity and difficulty in liquidation.

2. Gold Passbook
Bank-issued gold custody certificates, with buy/sell records stored in the passbook, allowing for physical withdrawal or deposit at any time. Advantages are portability; disadvantages include large bid-ask spreads, no interest, suitable only for long-term holding.

3. Gold ETF
Exchange-traded funds, with better liquidity than passbooks. After purchase, you hold a stock certificate corresponding to a certain amount of gold ounces. Disadvantages include management fees gradually eroding returns, especially when gold prices are sideways long-term.

4. Gold Futures
High leverage financial instruments suitable for short-term swing trading. Low margin costs, both long and short operations possible. Require investors to have certain professional knowledge and risk tolerance.

5. Gold CFDs(CFD)
Leverage trading with the highest flexibility. Compared to futures, CFDs offer more flexible trading hours, higher capital efficiency, and lower entry barriers. Especially suitable for small investors and retail traders for short-term swing trading.

Gold CFDs typically offer 1:100 leverage, with minimum trading units as small as 0.01 lots, enabling T+0 trading. Investors can go long(buy XAUUSD) when expecting gold prices to rise, or go short(sell XAUUSD) when expecting a decline, allowing for flexible two-way trading.

Stocks, Bonds, and Gold｜Different Profit Logic

The profit sources of these three assets are fundamentally different:

• Gold profits mainly from ‘price difference,’ with no fixed interest, success depending on timing of entry and exit.
• Bonds generate income from ‘coupon payments,’ requiring continuous increase in holdings to boost interest income, and making buy/sell decisions based on central bank policies.
• Stocks profit from ‘corporate growth,’ focusing on selecting quality companies for long-term holding.

In terms of investment difficulty ranking: bonds are easiest → gold next → stocks most difficult.

In terms of return ranking (varying over different periods): over the last 30 years, stocks lead, followed by gold, then bonds; but over the past 50 years, gold has been the top performer.

Economic Cycles Determine Asset Allocation｜The Correct Approach to Diversification

Markets change rapidly, and a one-size-fits-all investment rule is hard to find. But one rule of thumb is worth considering:

In periods of economic growth, allocate to stocks; during recessions, allocate to gold.

When the economy is good, corporate profits are optimistic, and stocks rise; at this time, gold, as a non-yielding asset, is less attractive. During economic downturns, stocks lose appeal, and gold’s value-preserving properties along with bonds’ fixed interest become more attractive.

The most prudent approach is to set the allocation ratios of stocks, bonds, and gold based on your risk profile and investment goals. Even if unforeseen events like Russia-Ukraine conflict or inflation-driven rate hikes occur, diversified holdings can offset some volatility, making the overall portfolio more resilient.

Market lessons tell us: there is no perfect single investment; only asset combinations that match your life stage and economic cycle.