If you've been watching gold climb while the rest of the market gets hammered, you're not imagining things. The yellow metal is having its moment, and investors are asking whether they've already missed the boat—or if there's more room to run.
Gold gained over 50% in 2025, according to investors tracking the metal's performance. That's the kind of year that gets people's attention, especially when stocks are selling off and uncertainty is the only thing markets can agree on.
So what's driving this? A few things, actually, and they're worth understanding before you decide whether gold belongs in your portfolio.
The Dollar's Losing Streak
First, the dollar has been weakening. When the greenback loses value, assets priced in dollars—like gold—tend to rise. It's basic math, but it's also psychology: a weaker dollar makes people nervous about holding cash, and they look for alternatives.
On top of that, central banks around the world are buying gold instead of dollars for their reserves. That's not just a technical shift—it's a vote of no confidence in the current system. When governments are diversifying away from the dollar, retail investors start paying attention.
Safe Haven, or Just FOMO?
Here's where it gets tricky. Gold is rallying because it's acting as a safe haven during economic chaos. But here's the question you need to ask yourself: are you buying gold because you understand its role in your portfolio, or because you're afraid of missing out on gains?
If it's the latter, slow down. FOMO is not an investment strategy.
Gold doesn't pay dividends. It doesn't grow earnings. It just sits there, shiny and expensive, betting that the world stays uncertain. Sometimes that bet pays off. Sometimes you're just paying storage fees for a rock.
When Does Gold Make Sense?
Gold makes sense as a hedge, not a growth play. If you're worried about inflation, currency debasement, or a serious market meltdown, holding 5-10% of your portfolio in gold is defensible. It's insurance, basically.
But if you're buying gold hoping it doubles again in 2026? That's speculation, and you should treat it accordingly. Don't bet money you can't afford to lose on a commodity that could just as easily flatline for the next decade.
Some investors are already wondering if the current environment could push people into crypto next—another "safe-to-risk rotation" where investors take profits from gold and pile into Bitcoin or other digital assets. Maybe. But that's a different kind of risk entirely.
The Bottom Line
Gold's having an incredible run, and there are legitimate reasons why. A weakening dollar, central bank buying, and economic uncertainty are all real factors pushing the metal higher.
But before you rush in, ask yourself: what problem am I trying to solve? If the answer is "I want to protect part of my wealth from currency risk and market chaos," then a modest gold allocation might make sense.
If the answer is "I saw it go up 50% and I want in on that," you're late to the party and about to pay full price for watered-down punch.
As always: if they can't explain it simply, they're probably hiding something. And if you can't explain why you own it, you probably shouldn't.
