## Twenty Years of Gold: From $400 to $4,270, an Unrivaled Price Evolution

As of early October 2025, the ounce of gold trades near **$4,270**, marking a milestone after several all-time highs this year. Just two decades ago, in the 2000s, the price hovered around $400. A difference of more than ten times. This equates to an accumulated revaluation of nearly **900%**—a growth that few investments can boast.

The **price evolution of gold** over these twenty years has not been linear or predictable. It has gone through phases of extraordinary boom, periods of technical stagnation, and, surprisingly, moments when it outperformed major stock indices. Understanding how it has reached this point requires looking back and recognizing recurring patterns.

## Four Decades, Four Different Stories

The recent trajectory of this precious metal can be divided into four well-defined acts.

**From 2005 to 2010: the revaluation fever**

In the first half of the 2000s, gold experienced one of its most vigorous periods. It rose from $430 to surpass $1,200 in just five years. The causes were multiple: a weakened dollar, rising energy prices, and especially the collapse of subprime mortgages that shook global markets. Lehman Brothers' bankruptcy in 2008 cemented its role as a safe haven asset. Central banks and institutional funds increased their purchases, recognizing in the yellow metal a genuine refuge.

**2010-2015: the corrective pause**

After the initial turbulence, markets found some stability. Developed economies recovered, and central banks began normalizing monetary policies. Consequently, gold lost some of its relative shine. It oscillated between $1,000 and $1,200, consolidating in a lateral band. It was not a disaster period but one of consolidation: the metal maintained its defensive function without explosive upside moves.

**2015-2020: the return of the protagonist**

This five-year span revitalized demand for gold. Trade wars between superpowers, explosive growth in public debt, and a cascade of rate cuts generated anxiety among investors. The COVID-19 pandemic was the final catalyst: gold surpassed $2,000 for the first time, validating its status as a trust beacon in crises.

**2020-2025: the unstoppable gallop**

In just five years, the price jumped from $1,900 to over $4,200—an increase of **+124%**. It was the chapter of the greatest nominal revaluation in its modern history. Expansionary monetary policies, unexpected inflation, and global geopolitical tensions turned gold into the star asset of this stage.

## Real Return: Comparison with Wall Street

Between 2015 and 2025, the **price evolution of gold** adds up to approximately **+295%** in nominal terms. Translated into an annualized rate, this represents between **7% and 8% annually**—remarkably solid for an asset that does not generate dividends or interest.

How does it compare with equity markets? The latest available data offer surprises:

| Asset | Year-to-date | 1 Year | 5 Years | Since inception |
|--------|--------------|--------|---------|----------------|
| **Gold** | 14.51% | 15.05% | 94.35% | 799.58% |
| **S&P 500** | 14.22% | 15.22% | 78.90% | 799.58% |
| **Nasdaq-100** | 19.65% | 23.47% | 115.02% | 5506.58% |
| **IBEX 35** | 35.55% | 33.67% | 129.62% | 87.03% |

What’s revealing here is that **over the last five years, gold has outperformed the S&P 500**, something that rarely happens over such extended periods. The Nasdaq-100 maintains its historical dominance, but that victory hides a crucial detail: gold achieved it with significantly less volatility.

In 2008, when indices plunged 30% or more, gold only retreated 2%. In 2020, it again played its role as a wealth protector. This is the true story behind the numbers.

## Why Gold Shines in Dark Times

The **price evolution of gold** responds to very specific dynamics. The main drivers are:

**Real interest rates (nominal minus inflation)**

When investors perceive that bonds do not protect their purchasing power, they turn to gold. Large liquidity injections by the Federal Reserve and the European Central Bank depressed real yields, massively boosting demand for the metal.

**The relative strength of the dollar**

Since gold is priced in dollars, a weak US dollar pushes the price upward. Dollar depreciations in 2020-2022 coincided precisely with the most violent upward swings.

**Inflation and public spending**

Massive post-pandemic stimulus programs rekindled inflation fears. Prudent investors flocked to gold to safeguard their savings. When inflation unexpectedly surged, demand multiplied.

**Geopolitical and trade tensions**

Trade wars, energy sanctions, and armed conflicts have acted as secondary but effective catalysts. Central banks in emerging countries increased their gold reserves as a way to reduce dependence on the dollar and diversify their assets.

## Gold in Your Portfolio: The Right Dose

Many investors see gold as a speculative vehicle for quick wealth. This is a conceptual mistake. Its true function is to preserve the real value of wealth, not to multiply it exponentially.

Financial advisors suggest an exposure of between **5% and 10%** of total capital in physical gold, gold-backed ETFs, or replicating funds. For portfolios heavily concentrated in stocks, this percentage acts as an insurance policy against sharp declines.

There is also an operational advantage: **the universal liquidity of gold**. Anywhere in the world, at any time, it can be converted into cash without suffering tariffs, restrictions, or volatility of other assets. In times of monetary tension or financial uncertainty, this is invaluable.

## Gold: Silent Safe or Speculation

The story of the **price evolution of gold** over two decades tells a clear narrative: it is the asset that shines when others falter. It does not generate extraordinary gains on its own but protects what you already have when the world becomes chaotic.

In 2008, it safeguarded portfolios. In 2020, it was a genuine refuge. In 2025, it competed with Wall Street while markets hesitated. These are no accidents: they reflect a deep economic truth.

For those building a long-term portfolio, gold remains an indispensable piece of the puzzle. It is not a ticket to quick wealth. It is the silent lifeboat that appreciates precisely when other financial instruments lose credibility. Twenty years ago, it played this role. Today, with a more volatile and unpredictable world, its importance has only grown.