In uncertain times, gold often becomes a popular investment because many investors see the precious metal as a safer haven than other options. Adding to gold’s allure is the strong performance of the metals sector in 2016.
Where commodities as a whole have faced a bear market in recent years — with the Bloomberg Commodity Index, which tracks 22 commodities, falling by 35% since the start of 2013 — metals have sometimes been a gleaming exception to that trend. The S&P Metals and Mining Industry (SPSIMM) clocked in as the best-performing sector in 2016, surging by 101.5%. While gold rose by a more modest 8.6% in 2016, the trend still raises the question: Should everyday investors add more of the precious metal to their portfolio?