Commodities and gold are the only assets showing positive returns

Update

Commodities and gold were the only asset classes providing positive returns to Sterling investors in the first half of 2022. Research by international investment consultant Asset Risk Consultants (ARC) found that 14 of 16 asset classes suffered losses in H1. Commodities and gold were the only exceptions.

A recent survey from Natixis Investment Managers found that financial advisers increasingly see commodities as an appealing option in an inflationary investment environment, a view shared by 73% of European advisers and 61% of their UK colleagues.

Broker Physical Gold noted that ‘In times of recession, money is typically withdrawn from investments like stocks and shares, and money itself loses value. Unlike that of fiat money, the supply of gold is limited and can maintain its value due to its scarcity and its enduring appeal as a precious metal. Gold has consistently performed well through shaky economic times. In the 2008 recession, the price of gold remained relatively stable throughout the first half of the global financial crisis, before moving up sharply halfway through the recession, and peaking at around $1,040/oz.’

Evolution of the price of a gold ounce since 2004

Nine asset classes have seen their worst losses since ARC started monitoring for its indices in 2003 over the past six months. For example, it has been 60 years since U.S. equities last recorded a similar fall in the first six months of the year. At that time, President John F. Kennedy faced escalating tensions between the U.S. and the Soviet Union over the Cuban Missiles Crisis.