Commodities vs. Gold

“Which Is the Better Inflation Hedge? Both have some merit, but one is better than the other.”

Over at Morningstar Amy Arnott posted a short article to answer the question.
Here’s a part of her analysis:

“As shown in the table below, commodities were more consistent as an inflation hedge. They outpaced inflation in all five of the periods shown, while gold fell behind in two of the five periods. Gold did excel during the two separate inflationary periods in the early and late 1970s….. It also posted strong gains during the more muted inflationary environment from September 2007 through July 2008……However, it fell behind in the late 1980s….. During the most recent inflationary spike from mid-2021 through March 2023, gold prices rose, but cumulative returns lagged the broader commodity index by about 13 percentage points.”

She delves into the reasons for this and provides a look at some of the issues.

Each of those who own the precious metal, its surrogate GLD (SPDR® Gold Shares) or own other commodities there is a reason. Disclaimer: I don’t old GLD, preferring the miners. I do own an energy ETF. These provide dividends and I hold them as a part of what I consider a balanced portfolio. Combined they are about 3.5% of my personal portfolio.

Since April 16 GLD seems to have settled within a range, which is about 43% higher than it was a year ago