Gold’s regime change has been missed. Investors should ask why
Gold briefly touched $7,900 an ounce in Australian dollars in January 2026 before pulling back to around $6,700 by February 2026. Even after the recent volatility, gold remains up roughly 150% over the past three years.
This isn’t a short-term bubble. It’s the beginning of a regime change.
Despite a speculative overshoot, most investors have been caught completely off guard. Asset allocators, super funds and individual investors alike have largely failed to respond. Many still hold little or no gold at all.
This hasn’t been a harmless oversight. It’s been an expensive one.
A $500 billion missed opportunity in super
Australia’s superannuation system now holds around $4.2 trillion.
If just 10% of that pool had been allocated to gold over the past three years, super members would be more than $500 billion better off today. That’s roughly 15% added to every super balance: one of the largest missed opportunities in modern Australian investing.
That raises an uncomfortable question: Why is gold ignored by fund managers?
Gold was dismissed because:
- It doesn’t pay income
- Interest rates were rising
- Consultants favoured private credit and unlisted assets as “better” defensive options
Every one of those arguments has proven wrong.
Why old assumptions on gold failed
Gold has risen:
- Through higher interest rates
- While real yields stayed negative
- As bonds struggled
- As inflation proved persistent
- As government debt exploded
Most importantly, it has risen while traditional portfolio assumptions broke down.
Since 2020, shares and bonds have become far more correlated. The classic 60/40 portfolio has offered far less protection than investors expected. Assets labelled as “defensive” were meant to preserve purchasing power, instead, inflation quietly eroded it.
Gold filled that gap.
Gold history
The 1970s provide a clear parallel. Inflation arrived in waves. Over the decade, gold rose roughly twenty-fold, while shares and bonds delivered deeply negative real returns.
We are not replaying the 1970s exactly, but the structural forces look familiar.
The structural backdrop has changed
- Global debt levels are far higher
- Fiscal deficits remain entrenched
- Central banks are constrained
- Currency debasement is no longer theoretical
The Japanese yen is trading near its weakest level since 1986, despite 40-year government bond yields rising above 4% after sitting below 1.5% just two years ago. Higher rates alone are no longer enough to defend currencies when debt loads are too large.
Have central banks adapted?
Central banks understand this changing reality.
They’ve been buying gold at the fastest pace in decades, not as a tactical trade, but as a strategic shift away from government bonds and the US dollar.
Private investors, however, have been far slower to adapt.
Many super funds still hold no gold allocation at all, favouring illiquid private assets that promise stability on paper but rely heavily on valuation assumptions and leverage.
Gold is defensive and liquid
The irony is that gold is one of the most liquid assets in the world.
- Trades 24 hours a day
- Has no credit risk
- Cannot be printed
- Has preserved purchasing power over long inflationary regimes
This isn’t about chasing performance. It’s about recognising when the investment landscape has changed.
How asset allocation made the difference at Stockspot
At Stockspot:
- Our High Growth Super option returned 19% over the past year (to 31 December 2025)
- Our Conservative option returned more than 14%
These results were roughly double the returns of many major diversified super funds.
The difference wasn’t market timing or complexity. It was asset allocation.
Treating gold as a strategic asset
A 12% – 15% allocation to gold played a meaningful role. We rebalanced as prices rose and trimmed exposure to manage risk. Gold is treated as a strategic asset, not a speculative bet.
Gold returns won’t be smooth. There will be pullbacks. Latecomers may feel pain along the way. The 1970s included a 50% fall between 1975 and 1976, followed by a 700% rally later in the decade.
Volatility doesn’t invalidate gold’s defensive role, it confirms it.
The real risk was being underexposed
What should concern investors isn’t that gold has risen sharply. It’s that most portfolios were positioned as if it never would.
For individual investors, this raises an awkward but necessary question: What were you being protected from?
If your adviser dismissed gold, or your super fund still holds almost none, what exactly were they protecting you from, given the cost of being wrong has been enormous?
Advisers are meant to adapt. Asset consultants are meant to reassess assumptions. When the data changes, portfolios should change too. In this case, the data has been screaming.
A regime change challenges old models
Gold has:
- Outperformed bonds
- Protected real wealth
- Diversified portfolios when diversification was desperately needed
Yet many investors were told to ignore it.
Regime changes are uncomfortable. They challenge careers. They expose outdated models. They reward those willing to look early, and punish those who wait for consensus.
Gold’s role in portfolios isn’t disappearing. The forces supporting it remain firmly in place; high debt, persistent inflation risk, fragile asset correlations and sustained central bank demand.
Investors don’t need to bet the farm on gold, but they do need to stop pretending it doesn’t matter.
When a core asset adds more than US$20 trillion in market capitalisation in three years, and most portfolios have next to no exposure, something has gone badly wrong.
And the responsibility for that doesn’t sit with markets.
It sits with advice.
If gold has been dismissed or ignored, ask why, and whether your portfolio assumptions still reflect today’s reality.
This article is adapted from an opinion piece published in The Australian Financial Review – There’s no gold bubble – this is the start of a regime change (3 February 2026).
