Does gold go up when stocks go down?

Not always. In the 2020 crash, $10,000 in gold ended at $9,638, and in 2022 at $9,267: it lost money, just less than stocks. In the 6 calendar years stocks fell since 1996, gold beat stocks in all 6 and rose in 3.

Is gold a good hedge against inflation?

Not in the 2021-2022 inflation, the highest since 1981. $10,000 in gold kept $8,340 of buying power, less than stocks ($9,236) or T-bill cash ($8,945).

How did gold do in the 2008 crash?

From the October 9, 2007 stock high to the March 9, 2009 low, $10,000 in gold grew to $12,392 while stocks fell to $4,481. But inside that window gold fell 29.4%, from March 17 to November 12, 2008.

Does 10% in gold help a retirement portfolio?

In this test, a retiree with $1,000,000 from January 2000 taking 4% has $259,233 left all in stocks and $1,157,158 with 10% gold. The gold slice left more for every start from 1997 to 2008, and less for every start from 2009 to 2016.

How long did gold take to recover from its 2011 peak?

$10,000 of gold bought at the August 22, 2011 high fell to $5,444, and was back to $10,000 on July 29, 2020, 8.9 years later. In buying power it took 13.5 years, until February 4, 2025.

Test #10 · Published October 28, 2026

Does gold protect you in a stock market crash? We tested every crash since 1996

By JJ, host of The $10K Test · October 28, 2026 · How the tests work

Watch on YouTube · Subscribe to the channel

My verdict: PARTLY TRUE.

The short answer: For crashes, yes in this test: gold did better than stocks in 4 of 4 S&P 500 drops of 20%+ since 1996. In the 2007-09 crash, $10,000 in stocks fell to $4,481 while $10,000 in gold grew to $12,392. But gold rose in only 2 of the 4, and it failed as inflation protection: in 2021-2022 it lost 16.6% of its buying power.

The key numbers

2007-09 crash: $10,000 in stocks fell to $4,481. $10,000 in gold grew to $12,392.
Gold rose in only 2 of the 4 big crashes. It fell 29% inside the 2008 crash (March to November 2008) and 12.5% in ten days in March 2020.
2021-2022 inflation: $10,000 in gold kept only $8,340 of buying power. Stocks kept $9,236 and T-bill cash $8,945. Gold came last.
90% stocks and 10% gold, rebalanced each January: $210,358 from $10,000 in 1996, against $211,283 all in stocks, with a worst drop of -49.5% instead of -55.2%.
Retire in January 2000 with $1,000,000 and take 4%: $259,233 is left all in stocks, $1,157,158 with 10% in gold.

The claim

Buy gold: it protects you when stocks crash and against inflation. It's common advice in gold-dealer ads and from some well-known personalities. Nobody is quoted here, because we found no source with those exact words.

Common advice; nobody is named or quoted in this test.

How we tested it

Stocks: the S&P 500 with dividends reinvested (the SPY fund), daily closes from January 2, 1996 to October 8, 2026.
Gold: the gold futures price until November 17, 2004, then GLD, a fund that holds physical gold. Where both exist, GLD trailed the futures price by 0.44% a year, about its fee.
Crashes: every fall of the S&P 500 with dividends of 15% or more from a record high. Four were 20%+. $10,000 went into stocks and into gold at the stock market's high, and both were valued at its low.
Inflation: the government's consumer price index (BLS CPI). After inflation means what the money could buy compared with the start.
Mixes: 90% stocks and 10% gold, 80/20, and 90% stocks with 10% in T-bill cash, rebalanced on the first trading day of each January. Retirees: $1,000,000, 4% the first year raised with inflation, paid monthly (the same method as our 8% rule test).
No dealer markups, storage or taxes: the best case for gold.

Does gold go up when the stock market crashes?

Not always, but it did better than stocks every time. Per $10,000 put in at the stock market's high and valued at its low: 2000-02 stocks $5,249, gold $11,252. 2007-09 stocks $4,481, gold $12,392. 2020 stocks $6,628, gold $9,638. 2022 stocks $7,550, gold $9,267.

Gold rose in only 2 of the 4. In 2020 and 2022 it lost money, just much less than stocks. It also did better than stocks in the three 15-20% drops, in 1998, 2018 and 2025.

Gold had its own scary stretches inside the crashes: down 29% from March to November 2008, 12.5% in ten days in March 2020, and 21% inside 2022.

Does gold protect against inflation?

Not when inflation actually came, in this test. In 2021 and 2022 prices rose 14.0%, and 12-month inflation peaked at 9.0% in June 2022, the highest since November 1981. $10,000 in gold went to $9,511, which bought only $8,340 of what it bought before: 16.6% less. Stocks kept $9,236 of buying power and T-bill cash $8,945. Gold came last.

It wasn't one bad stretch. In the 9 years since 1996 with inflation of 3% or more, gold beat inflation in 5 and stocks in 6. The correlation between gold's yearly return and yearly inflation was 0.05, which means no link.

Over the whole 30 years gold did beat inflation: it multiplied buying power 4.46 times. Stocks multiplied it 9.78 times.

How long can gold stay down after a peak?

Gold bought at the August 22, 2011 high fell to $5,444 per $10,000 by December 2015. It was back to $10,000 on July 29, 2020 (8.9 years) and back in buying power on February 4, 2025 (13.5 years). While gold fell 45.6%, stocks rose 98.3%.

Stocks have had lost decades too. Bought at the March 24, 2000 high, they needed 13.1 years to get their buying power back. From 2000 to 2009 stocks lost 8.7% and gold gained 269.8%. Both had bad decades, at different times.

Does a 10% gold slice help a retirement portfolio?

In this test, yes. 90% stocks and 10% gold, rebalanced each January, turned $10,000 in 1996 into $210,358, against $211,283 all in stocks. The worst drop was -49.5% instead of -55.2%. Rebalancing means once a year selling a little of what went up and buying what went down, to get back to 90/10. With 10% in cash instead of gold: $174,975, and a worst drop of -50.7%.

For a retiree with $1,000,000 in January 2000, taking 4% raised with inflation: all stocks has $259,233 left, with 10% gold $1,157,158. Per $10,000, that's $2,592 against $11,572. The gold slice left more money for every start from 1997 to 2008, and 1.0% to 10.8% less for every start from 2009 to 2016 (and 1.9% less for 1996).

The catch: this worked because gold boomed in the same decade stocks went nowhere. That pairing may not repeat.

$10,000 put in at the stock market's high, value at its low
Stock market fall	Size	Stocks	Gold	90% stocks, 10% gold
Jul 20 to Aug 31, 1998	15-20%	$8,098 (-19.0%)	$9,400 (-6.0%)	$8,209
Mar 24, 2000 to Oct 9, 2002	20%+	$5,249 (-47.5%)	$11,252 (+12.5%)	$5,749
Oct 9, 2007 to Mar 9, 2009	20%+	$4,481 (-55.2%)	$12,392 (+23.9%)	$5,058
Sep 20 to Dec 24, 2018	15-20%	$8,065 (-19.4%)	$10,503 (+5.0%)	$8,271
Feb 19 to Mar 23, 2020	20%+	$6,628 (-33.7%)	$9,638 (-3.6%)	$6,933
Jan 3 to Oct 12, 2022	20%+	$7,550 (-24.5%)	$9,267 (-7.3%)	$7,722
Feb 19 to Apr 8, 2025	15-20%	$8,124 (-18.8%)	$10,161 (+1.6%)	$8,338

S&P 500 with dividends (SPY); gold futures price to November 2004, then GLD; 90/10 rebalanced each January. No dealer markups, storage or taxes.

The verdict

PARTLY TRUE. The crash half held up in this 30-year window: gold did better than stocks in all four 20%+ drops and in the three near-misses. The inflation half failed when it mattered: in 2021-2022, gold lost more buying power than stocks or cash. It worked as a small slice, about 10%, rebalanced each January, for someone who fears a crash early in retirement. Not as a big holding, and not as an inflation plan.

What this test leaves out

One country, one 30-year window. Gold's 2001-2011 boom happened while stocks went nowhere; that pairing may not repeat.
Gold is up 56.4% since the end of 2024, which flatters the whole-period numbers. Measured to the end of 2019, $10,000 from 1996 was $36,389 in gold and $79,891 in stocks.
Crash windows use the stock market's exact high and low, which nobody can time. The calendar-year view tells the same story: gold beat stocks in all 6 down years for stocks since 1996, and rose in 3 of them.
Gold before November 2004 is the futures price, with no fees; after that, GLD with its fee. No dealer markups, storage, insurance or taxes. Coins and bars bought from a dealer would do worse than these numbers.

Data: SPY (S&P 500 with dividends); gold: futures price to Nov 2004, then GLD; inflation: BLS CPI; 1996 to Oct 2026. Every number on this page comes from the test results.

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Questions people ask

Does gold protect you in a stock market crash?: In this test, gold did better than stocks in all four S&P 500 drops of 20%+ since 1996. In 2007-09, $10,000 in stocks fell to $4,481 while gold grew to $12,392. But gold itself rose in only 2 of the 4.
Does gold go up when stocks go down?: Not always. In the 2020 crash, $10,000 in gold ended at $9,638, and in 2022 at $9,267: it lost money, just less than stocks. In the 6 calendar years stocks fell since 1996, gold beat stocks in all 6 and rose in 3.
Is gold a good hedge against inflation?: Not in the 2021-2022 inflation, the highest since 1981. $10,000 in gold kept $8,340 of buying power, less than stocks ($9,236) or T-bill cash ($8,945).
How did gold do in the 2008 crash?: From the October 9, 2007 stock high to the March 9, 2009 low, $10,000 in gold grew to $12,392 while stocks fell to $4,481. But inside that window gold fell 29.4%, from March 17 to November 12, 2008.
Does 10% in gold help a retirement portfolio?: In this test, a retiree with $1,000,000 from January 2000 taking 4% has $259,233 left all in stocks and $1,157,158 with 10% gold. The gold slice left more for every start from 1997 to 2008, and less for every start from 2009 to 2016.
How long did gold take to recover from its 2011 peak?: $10,000 of gold bought at the August 22, 2011 high fell to $5,444, and was back to $10,000 on July 29, 2020, 8.9 years later. In buying power it took 13.5 years, until February 4, 2025.

What's in the video

0:00 Intro
0:28 The claim
1:27 How we tested it
2:36 The crashes
3:51 Inflation
5:00 The long wait
6:00 Why it happened
6:33 What actually worked
8:27 The verdict
9:11 Free weekly email + disclosure

Read the script of the video

The words JJ read on camera for this test. The final video may differ slightly.

In 2022, inflation hit about 9%, the highest since 1981. That's exactly what gold is supposed to protect you from. Over 2021 and 2022, $10,000 in gold lost about a sixth of its buying power. Stocks lost less. Even plain cash lost less.

But when the stock market crashed, gold did something the ads get exactly right.

I am JJ, and this is the 10K Test. Every week I take a piece of money advice everybody repeats and test it against real market history. Not opinions. What the money actually did.

Today: gold. You've probably heard it in a late-night ad, or from a personality on TV or the radio. Buy gold, because it protects you when the stock market crashes, and it protects you against inflation.

It's easy to believe. Gold has been money since ancient times. It doesn't depend on any company's profits. And when the news gets scary, people run to it.

If it's true, it matters most if you're close to retirement, because a crash in your first few years can do damage that never comes back. So let's test both halves: crashes, and inflation.

That's this channel: advice you hear everywhere, tested on 30 years of real prices, and called out where it fails. Subscribe if that's useful.

Here's exactly what we did, so you can check it.

For stocks, we used the S&P 500, through the fund called SPY, with dividends reinvested. For gold, from November 2004 on, we used GLD, a fund that owns real gold. Before that, we used the gold price from the futures market. Where the two overlap, they line up closely, apart from the fund's small yearly fee.

First, we found every time since 1996 that the S&P 500, dividends included, fell more than 20% from a high. There were four: the dot-com crash, the financial crisis, the COVID crash in 2020, and 2022. For each one, we put $10,000 in stocks and 10,000 in gold at the market's high, and checked both at its low.

Then we looked at inflation, using the government's own inflation numbers. Then the whole stretch, January 1996 to October 2026, about 30 years.

We left out dealer markups on coins and bars, storage, and taxes. So this is the best case for gold.

Let's start with crashes, because this is where gold earns its reputation.

The dot-com crash. From March 2000 to October 2002, $10,000 in stocks fell to about 5,250. 10,000 in gold grew to about 11,250.

The financial crisis. October 2007 to March 2009. Stocks: down to about 4,480. Gold: up to about 12,400.

COVID, February to March 2020. Stocks: about 6,630. Gold: about 9,640.

And 2022. Stocks: 7,550. Gold: about 9,270.

Four crashes. Gold beat stocks 4 times out of 4. It also did better in three smaller drops, in 1998, 2018 and 2025.

But notice: gold didn't always go up. In 2020 and 2022 it lost money, just a lot less. And inside the crashes, gold had its own scary stretches. In 2008, gold fell about 29% from March to November before it came back. In the March 2020 panic, it dropped about 12 and a half percent in 10 days. If you'd sold your gold in a panic, you wouldn't have gotten the protection.

Now the second half of the claim: inflation.

Over the full 30 years, gold did beat inflation. $10,000 in gold in January 1996 grew to about $96,000. Prices more than doubled in that time, so in real buying power, gold multiplied your money about 4 and a half times. Stocks multiplied it almost 10 times.

The real test is when inflation actually shows up. In 2021 and 2022, prices rose about 14%. Inflation hit about 9% a year in June 2022, the highest since 1981. This is the moment gold is supposed to be for.

$10,000 in gold at the start of 2021 was worth about 9,500 at the end of 2022. After inflation, that's about $8,340 of buying power. A sixth of it, gone. Stocks, after inflation: about 9,240. Even plain cash, in Treasury bills: about 8,950. Gold came in last.

And it wasn't a one-off. In the 9 years since 1996 when inflation ran 3% or more, gold beat inflation in 5. Stocks, in 6. That's not protection. That's a coin flip.

Here's the part that matters most if you're retired and living off your savings.

Gold has long, flat stretches. Say you bought $10,000 of gold at its high in August 2011. By December 2015 it was worth about 5,440. Almost half gone, while stocks almost doubled. You didn't get back to $10,000 until July 2020. Almost 9 years. After inflation, you didn't get your buying power back until February 2025. About 13 and a half years.

To be fair, stocks have done this too. Stocks bought at the March 2000 high took about 13 years to get their buying power back. Both have lost decades. They just tend to have them at different times.

One more warning: gold is up about 56% since the end of 2024, and that recent run flatters its 30-year number. Measured to the end of 2019, $10,000 in gold from 1996 had grown to about 36,000. Stocks: about 80,000.

So why does gold do well in crashes, but poorly as an inflation shield?

Gold doesn't pay you anything. No dividends, no interest. Its price is whatever the next buyer will pay. When people get scared of stocks, some money runs to gold, and that showed up in every crash we tested. But in any one year, gold's price seems to move more on fear than on grocery prices. In our 30 years, high-inflation years and good gold years just didn't line up.

So is gold useless? No. Here's what worked in the same data: a small slice.

We tested 90% stocks and 10% gold, rebalanced every January. Rebalancing means once a year you sell a little of whatever went up and buy whatever went down, to get back to 90 and 10.

From 1996 to today, $10,000 in all stocks grew to about 211,000. 90-10: about 210,000. Almost the same money. But the worst drop was smaller: about 49 and a half percent instead of 55. And after 2008, the 90-10 mix got back to its old high about a year and a half sooner.

10% in cash instead of gold had about the same worst drop, about 51%, but ended with only about 175,000. In this stretch, gold was the better cushion.

Now the retiree. Same setup as our 8% episode: $1 million, retired in January 2000, taking out 4% the first year and raising it with inflation. All in stocks, that retiree has about $259,000 left today. With 10% in gold, rebalanced every January, about 1.16 million. In $10,000 terms: about 2,600 left, versus about 11,570.

That's not just one lucky year. For people who retired from 1997 through 2008, the gold slice left more money every time. For people who retired from 2009 through 2016, right after the crash, it left a little less: between 1 and 11% less.

One honest catch: this worked because gold happened to boom in the same decade that stocks went nowhere. From the start of 2000 to the end of 2009, stocks lost about 9%. Gold went up about 270%. There's no rule that says that will happen again. A 10% slice is insurance, not a plan to get rich.

So: buy gold, it protects you when stocks crash and against inflation. Verdict: PARTLY TRUE.

The crash half held up in our data. Gold beat stocks in all four big crashes since 1996, and in the three near-misses. The inflation half failed when it mattered. In the worst inflation since 1981, gold lost more buying power than stocks or cash.

Who did gold help? Retirees hit by a crash in their first few years, with gold as a small slice, around 10%, rebalanced every year. Not a big chunk of savings, and not an inflation plan. And if you buy coins or bars from a dealer, the markup comes out of every number you just saw.

Every week I send a free email with the full numbers behind each test, the tables, the charts, and what we're testing next. Free weekly email at 10Ktest.com.

And tell me in the comments what money advice you want tested next.

This video is for education and entertainment, not personal financial advice. Your situation is different; talk to a professional before buying gold or changing how your retirement money is invested.

Disclosure: I own shares of Franco-Nevada, a gold royalty company, so I have a stake in gold doing well. I don't own gold or a gold fund, and I don't own an S&P 500 index fund. I do own some individual stocks, including Apple, which is part of the S&P 500. Nobody paid for this video.

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Education and entertainment only. Not personal financial advice. Your situation is different; talk to a professional before buying gold or changing how your retirement money is invested. Disclosure: I own shares of Franco-Nevada, a gold royalty company, so I have a stake in gold doing well. I don't own gold or a gold fund, and I don't own an S&P 500 index fund. I do own some individual stocks, including Apple, which is part of the S&P 500. Nobody paid for this video.