If Russia invades Ukraine, why is gold unlikely to be a safe haven for your money?
the percentages shown in the table are insignificantly different from 50%. That means that our best bet is that gold’s direction in the wake of a crisis is largely a matter of a coin flip. Gold as a stock-market hedge The same conclusion emerges when we approach the question from an entirely different perspective. This alternate direction was proposed in a 2013 paper by Campbell Harvey which is when gold began trading freely in the U.S. Over subsequent… % of time gold at end of period was lower than where it stood when crisis erupted Month 50.0% Quarter 66.7% Six Months 45.5% 12 months 36.4% Given that there are only a dozen crises in this sample Ukraine’s president says Wednesday ‘Will be the day’ of Russia’s attack the price of gold was 5.8% lower than before the invasion. That crisis constitutes just one data point +1.70% usually declines in the wake of geopolitical crises. Investors betting on gold because of the Ukrainian crisis should re-examine their assumptions. Perhaps the closest historical precedent to the current crisis was Russia’s annexation of Crimea in late February 2014. A month after Russia sent soldiers into Crimea Gold is rallying now but don’t be surprised to see prices fall if Russia invades Ukraine. That’s because the price of gold GC00 why is gold unlikely to be a safe haven for your money but gold’s experience is consistent with my analysis of gold’s reaction to other geopolitical crises. Consider the list that appeared in a recent MarketWatch article on how the stock market typically reacts to such crises . The table below reports the percentage of time gold declined in the wake of the dozen crises on the list that have occurred since the early 1970s gold bullion was 3% lower than where it stood the day before. Three months later a a former commodities portfolio manager at TCW Group . Their idea was to focus on those months in which the SP 500 SPX
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