Ray Dalio Recommends All Investors Hold ‘At Least Some’ Gold In Their Portfolios

• Dalio explained that all money has historically been either “linked/hard-asset-backed” or fiat. 
• He suggested holding between 5% and 15% of a portfolio in gold, depending on the investor’s risk profile and other assets. 
• Dalio also cited gold’s low confiscation risk as a key advantage. 

Billionaire investor and founder of Bridgewater Associates Ray Dalio recommended in an article on Thursday that every investor should hold ‘at least some’ amount of gold in their portfolio.

In an explainer published on X, Dalio highlighted that gold has preserved its value across thousands of years, while fiat currencies have repeatedly lost purchasing power. He noted that while gold may underperform in normal conditions like cash, it remains essential for portfolio diversification and protection against systemic financial risks. 

“Most investors don’t own any,” he wrote, emphasizing the need for a baseline allocation in gold. After a week of losses, gold prices climbed higher in Thursday afternoon trade. The SPDR Gold Shares ETF (GLD) rose 1.7% but retail sentiment on Stocktwits remained in ‘bearish’ territory over the past day.

In any case, what I’m trying to get across is that you should think of gold as being a fundamental money that you should own at least some of. 

– Ray Dalio, Founder, Bridgewater Associates

Gold’s Historical Role

Dalio explained that all money has historically been either “linked/hard-asset-backed” or fiat. “Gold has been valued as money over thousands of years and in almost all countries, while all other monies have come and gone,” he said. 

Hard-asset currencies were redeemable at fixed rates, while fiat currencies are not limited in supply, he stated. When debt levels outpaced the gold supply, Dalio noted, “the monetary system broke down,” leading either to deflationary depressions or currency devaluation.

Strategic Allocation Over Speculation

For investors, Dalio recommends viewing gold as a strategic asset rather than a speculative one. “When investors ask me if they should buy or sell gold based on whether I think it will go up or down, I tell them that’s a tactical, secondary question,” he wrote. 

He suggested holding between 5% and 15% of a portfolio in gold, depending on the investor’s risk profile and other assets. “Any deviations from that portfolio should only take place if the investor believes that they have better abilities to market-time which investments are better than others. Most investors don’t have this ability, so they should just stick with their strategic asset allocation mix,” he wrote.

Gold As A Hedge Against Confiscation And Crisis

Dalio also cited gold’s low confiscation risk as a key advantage.“It is the toughest money to grab because it can be held in one’s own secure possession, unlike all other monies that require others to make payments of money to give them value. It can’t be stolen in cyberattacks.” 

Dalio’s guidance builds on his earlier views that while gold may underperform in normal economic conditions, it remains an essential “fundamental money” that most investors overlook, and a critical hedge against systemic financial risk.

Read also: Bitcoin Dips, Triggers $800 Million In Crypto Liquidations After Powell’s December Warning

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