Gold's annual investment returns compared with other major UK asset classes
ANNUAL PERFORMANCE of the major asset classes has varied widely over the past 50 years.
But how widely? And here at the start of 2024, how do the annual returns from gold – by far the best performing investment of the 21st century so far for UK investors – stand in comparison with stocks and shares, bonds, property and cash?
Here, BullionVault's research team have gathered and published the annual investing returns data for the major UK asset classes since 1974, the year after the first global Oil Crisis followed the end of the global Gold Standard, sending inflation in the cost of living soaring as the world's currencies began to float freely of each other.
Gold's historical annual returns in the last 20 years
Gold priced in the UK Pound has topped the interactive table below only 3 times since 2000, yet it has beaten the overall investment returns of silver (the winner 6 times) and the FTSE All Share (which has come top 4 times when dividends are included).
For New Year 2024, BullionVault has also collated and compared US data for the best performing assets from 1974-2023.
Gold's annual performance in 2013 sank to the bottom of the table, delivering its heaviest loss to UK investment portfolios in our 50-year series with a plunge of 29.4%. It then recovered sharply amid the political shocks of 2016 (first the UK's Brexit referendum and then the election of Donald Trump to the White House), stalling in 2017 but topping the table again as shares fell in 2018, showing double-digit gains in the last year of the 2010s.
Latest UK asset class annual performance
Gold came second only to silver's startling 42.1% surge on BullionVault's UK annual asset performance table amid the Covid Crisis of 2020.
Gold and silver both then fell back for UK investors, but they jumped again in 2022 as inflation surged to put commodities top of the league for asset-class returns in both 2021 and 2022. The FTSE escaped that year's steep plunge in global stock markets but UK government Gilts didn't, costing bond holders 21.3% of their money.
The precious metals diverged in 2023, with gold rising against the British Pound but silver falling as world stock markets rallied and Gilt prices stabilized, giving UK bond holders their first positive return in 3 years.
Note also that, contrary to common thinking, gold doesn't always beat inflation in the cost of living year-to-year. Indeed, priced in British Pounds it lagged the UK's RPI index 25 times between 1974 and 2023.
Volatility in gold's annual returns outstrips other assets, as the notes to BullionVault's performance tables show. But the lessons from 2008 and 2020 remain plain.
Best Performing Annual Assets UK 1974-2023
Click on the column headings to sort the table by Year or Asset returns.
Asset class diversification really does matter
Gold really has acted as portfolio insurance when investors needed it most. Making an allocation to bullion should be a prime consideration when you look for help to offset the equity, interest-rate and real-estate risk of a broader, well-balanced investment portfolio of different asset classes.
Please note: These tables are published to inform your thinking, not lead it. All information and analysis must be verified elsewhere should you choose to act. All data are total returns, before costs or taxation (unless specified).
UK Pound asset-class performance, annual returns for 50 years since 1974: Key
| UK Inflation | UK long-run Retail Price Index (RPI) series |
| Gold | Last London Gold Fix of the year in GBP |
| Silver | Last London Silver Fix of the year in GBP |
| UK Stock Market | FTSE All-Share total returns index |
| World Equities | Global Shares total returns index |
| UK Government Bonds | 10-year UK government bonds, yield + capital value |
| UK Bank Savings | 3-month UK Treasury bill rate, daily average |
| UK Housing | HM Land Registry via ONS, no rent or costs |
| Commodities | Reuters-CRB Continuous Commodity Index (CCI) |
Now that 2024 has begun, and using the historical investment returns data gathered by BullionVault for you to study in the table below, here's a brief overview of how gold has performed across the past 50 years.
Notes on gold's annual performance comparison, UK data
- Shares have topped this table most often, with the UK's own FTSE All-Share and global stock markets coming first 11 times. They're followed by silver (10) and gold (5 times).
- Silver came bottom most often (13 times) followed by Commodities (10x) and then UK government bonds (6x);
- There's never yet been a year since 1974 when all these asset classes lagged behind the cost of living. But they came close in 1990 (when only cash in the bank beat inflation) and 2018 (when gold rose 4.6%, almost 2 points faster than the RPI index);
- Both times that UK shares were the worst performing asset class (2008 and 2018) gold was the best;
- Gold failed to top this table 25 years running starting in 1980. Cash in the bank beat inflation for 28 years running from 1981.
