Ray Dalio says today is like the early 1970s and investors should hold more gold than usual

Bridgewater Associates laminitis Ray Dalio said investors should allocate arsenic overmuch arsenic 15% of their portfolios to golden adjacent arsenic the precious metallic surged to an all-time high supra $4,000 an ounce.

"Gold is simply a precise fantabulous diversifier successful the portfolio," Dalio said Tuesday astatine the Greenwich Economic Forum successful Greenwich, Connecticut. "If you look astatine it conscionable from a strategical plus allocation perspective, you would astir apt person thing similar 15% of your portfolio successful golden … due to the fact that it is 1 plus that does precise good erstwhile the emblematic parts of the portfolio spell down."

Gold futures twelvemonth to date

Gold futures were past trading astatine $4,005.80 per ounce. Prices person skyrocketed much than 50% this year amid a formation to information amid mounting fiscal deficits and rising planetary tensions.

The billionaire capitalist compared today's situation to the aboriginal 1970s, erstwhile inflation, dense authorities spending and precocious indebtedness loads eroded assurance successful insubstantial assets and fiat currencies.

"It's precise overmuch similar the aboriginal '70s...where bash you enactment your wealth in?" helium said. "When you are holding wealth and you enactment it successful a indebtedness instrument, and erstwhile there's specified a proviso of indebtedness and indebtedness instruments, it's not an effectual storehold of wealth."

Dalio's proposal contrasts with emblematic portfolio recommendations of fiscal advisors which archer clients to clasp mostly stocks and immoderate bonds successful a 60-40 split. Alternative assets similar golden and different commodities are usually suggested to beryllium a debased single-digit percent of immoderate portfolio due to the fact that of the deficiency of income they generate.

DoubleLine Capital CEO Jeffrey Gundlach also precocious recommended a precocious weighting successful gold — arsenic overmuch arsenic 25% successful the portfolio — arsenic helium believes golden volition proceed to basal retired connected the backmost of inflationary pressures and a weaker dollar.

Dalio said golden stands isolated arsenic a hedge successful times of monetary debasement and geopolitical uncertainty.

"Gold is the lone plus that idiosyncratic tin clasp and you don't person to beryllium connected idiosyncratic other to wage your wealth for," helium said.