The massive surge in gold rates in 2025 has once again brought the spotlight back to the yellow metal. Ahead of Dhanteras and Diwali, many Indian buyers are finding it hard to digest the steep rise in prices — almost changing daily over the past several weeks. For centuries, gold has been a symbol of wealth, prosperity, and financial safety. But beyond its glitter and emotional value, there are many lesser-known truths about gold as an investment asset that even seasoned investors might not know.
While no one can accurately predict where this current rally will stop, investors can certainly benefit from understanding gold more deeply. According to the latest report by the World Gold Council (WGC), gold continues to surprise in more ways than one. Here are five little-known but surprising facts about gold that will make you look at this asset differently.
1. Gold Is More Liquid Than Many Major Financial Markets
When people think about “liquid assets,” they often imagine cash, stocks, or bonds. But surprisingly, gold is one of the most liquid assets in the world. According to the WGC, physical gold holdings by investors and central banks are worth around $5.1 trillion, while trading volumes reached a record $329 billion per day during the first half of 2025.
That means gold changes hands more frequently than most people realize. In fact, the gold market is more liquid than several major financial markets, including the Dow Jones Industrial Average, one of the world’s oldest and most followed stock indices.
Gold’s daily trading volume is comparable to 10-year US Treasuries and exceeds the most traded US equities, making it not just a shiny ornament or safe-haven investment — but a massive, active global marketplace.
What this means for investors:
If you ever need to sell gold, finding a buyer is never an issue. Gold can be easily converted into cash anywhere in the world, making it a powerful asset for liquidity and stability.
2. 50-Year Returns Are Better Than Bonds and Comparable to Equities
Gold is often viewed as a “defensive” asset — something that protects wealth rather than grows it. But that perception is only half true. Over the last five decades, gold has quietly delivered returns that rival equities (stocks) and outperform bonds.
In fact, according to the WGC, the price of gold in US dollars has risen by around 8% annually over the past 50 years. That is roughly comparable to long-term equity market performance and significantly higher than the returns generated by bonds.
This means if you had invested in gold in the 1970s and held it until now, your returns would be close to what you’d have earned from stocks, and far superior to government or corporate bonds.
Why this matters:
Gold is not just about safety — it’s also about performance over time. While it may not offer quick profits, it has proved to be a strong long-term wealth builder, providing both protection and growth.
3. Gold Is Now the World’s Second-Largest Reserve Asset — After the US Dollar
This one might surprise even the most informed investors. While the US dollar remains the world’s dominant reserve currency, gold has now become the world’s second-largest reserve asset, overtaking the euro.
The WGC report, citing The Times, notes that in June 2025, the European Central Bank confirmed that gold had overtaken the euro in global reserves. This development highlights just how important gold remains in global finance — not just for individuals, but also for entire nations.
During times of economic instability, central banks tend to increase their gold holdings. Gold is not tied to any single country’s economy or political system, making it a universal and trusted store of value.
State Street’s survey (quoted by the WGC) also reveals that 49% of financial advisers see gold as a great diversifier in mixed portfolios — a key asset that reduces risk when markets are volatile.
What this means for investors:
When central banks themselves are turning to gold as their preferred reserve asset, it sends a strong message: gold is global money. It holds its value across borders and through economic cycles, making it an essential part of any diversified investment portfolio.
4. Gold Is 100% Recyclable – The Most Circular Asset on Earth
Among all major assets, gold stands out as one of the most environmentally sustainable and circular materials. Every ounce of gold that has ever been mined is still in use in some form — whether in jewelry, electronics, or financial reserves.
According to the WGC, gold is 100% recyclable, and almost no part of it ever goes to waste. This makes it one of the most circular assets in the world. Randy Smallwood, CEO of Wheaton Precious Metals, was quoted in the report saying, “It’s as close to 100% recycling as you can get.”
Gold’s versatility extends beyond ornaments and coins. It plays a crucial role in technology and healthcare, particularly in electronics, aerospace, and medical devices. Because it doesn’t corrode or tarnish, gold is often used in critical systems where reliability is essential.
Environmental significance:
Unlike other mined resources that eventually degrade or lose utility, gold’s life cycle is practically infinite. It can be melted, reshaped, and reused indefinitely, reducing the need for fresh mining and helping conserve natural resources.
What this means for investors:
Owning gold is not just financially smart — it’s environmentally sound. Gold’s recyclability ensures that its intrinsic value remains preserved forever, unlike consumable or depreciating assets.
5. Gold Doesn’t Provide Regular Income — But It Still Pays in the Long Run
This is perhaps the most debated fact about gold. Despite its many strengths, gold is not a yield-generating asset. It doesn’t pay interest, dividends, or rent, unlike bank deposits, bonds, or real estate.
In other words, gold simply sits in your portfolio and grows in value over time — you only earn when you sell it after its price appreciates.
The WGC report mentions that 54% of financial advisers believe the lack of regular income is gold’s biggest drawback. This is why gold should not be seen as a standalone investment, but as a strategic component of a balanced portfolio.
So why hold gold then?
Because gold offers what other assets often can’t — protection against uncertainty, inflation, and currency devaluation. When markets fall, currencies weaken, or inflation rises, gold tends to gain value.
For example, during global crises such as the 2008 financial meltdown or the 2020 pandemic, gold prices surged while other assets declined. That’s why it’s often called a “crisis hedge.”
What this means for investors:
Gold is best viewed as insurance for your wealth. It may not pay you monthly income, but it shields you from big losses when markets crash — helping stabilize your overall returns in the long run.
Why Gold Still Matters in 2025 and Beyond
As of 2025, global gold prices have reached record highs, driven by multiple factors — geopolitical tensions, inflation fears, and central bank purchases. Yet, the fundamentals of gold remain timeless.
Here’s why gold continues to matter in modern investment strategies:
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Inflation Hedge:
Gold typically rises when inflation erodes the value of paper money. It acts as a natural hedge against rising prices. -
Portfolio Diversification:
Gold’s price movements are often uncorrelated with stocks and bonds. Adding even 10% gold to a portfolio can reduce overall risk. -
Crisis Protection:
When uncertainty increases — be it due to wars, recessions, or market crashes — gold often becomes the go-to asset for safety. -
Universal Acceptance:
Gold has value everywhere — from India to the US, from Africa to Europe. It’s accepted globally, making it one of the few truly borderless assets. -
Long-Term Stability:
Over centuries, empires have risen and fallen, currencies have come and gone, but gold has retained its worth. It is time-tested wealth.
A Balanced View: Should You Invest in Gold Today?
The answer depends on your financial goals. If you’re seeking steady monthly income, gold alone may not serve your purpose. But if your aim is wealth preservation, diversification, and protection against inflation, gold deserves a place in your portfolio.
Experts recommend holding 5–15% of your portfolio in gold — through physical gold, sovereign gold bonds, or gold ETFs. This allocation helps cushion against market shocks while maintaining liquidity.
In the current environment of high inflation and global uncertainty, gold’s defensive qualities are shining brighter than ever. However, investors should avoid chasing short-term rallies. Instead, view gold as a long-term stabilizer, not a quick-profit instrument.
Final Thoughts
Gold’s story is as old as civilization itself, yet it continues to surprise modern investors with its depth and versatility. Beyond its glitter and emotional significance, gold remains a powerful financial instrument — liquid, stable, recyclable, and globally trusted.
From being more liquid than major stock markets to becoming the world’s second-largest reserve asset, gold has proven that it’s far more than just a decorative metal. It’s an enduring store of value, a silent protector of wealth, and a timeless companion in uncertain times.
So, the next time you buy gold — whether for Dhanteras, investment, or sentiment — remember these five facts. They reveal why, even in the digital age, gold continues to shine not just in beauty, but in brilliance as an asset.
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