From October 2007 to March 2009, SPY (the S&P 500 exchange-traded fund, or ETF) fell 55.2%. The S&P 500 is an index of 500 large US companies. Over the same dates, GLD (the gold ETF) rose 23.9%. Yet in the middle of that fall, GLD dropped 29.4% in eight months.
A safe haven is an asset that holds its value when the stock market falls. This guide tests gold against every big fall in US shares since 2004, using the two funds' daily prices. It then looks back to 1971, using the monthly gold price.
Is gold a safe haven? A safe haven is an asset that holds its value when shares fall. Gold has done so over most big stock market falls since 1971, but it has also fallen sharply partway through some of them.
Since November 2004, a fund tracking the S&P 500 fell 10% or more seven times. A gold fund rose over four of those falls and fell over three.
The gold fund also dropped sharply partway through some falls. It lost 29.4% from March to November 2008. It lost 12.5% in ten days in March 2020.
Since 1971, the S&P 500 fell 20% or more five times. On monthly averages, the gold price rose in four of them. It fell 7.0% in 2022.
What a safe haven means
In a 2010 study, the economists Dirk Baur and Brian Lucey defined a safe haven as "a security that is uncorrelated with stocks and bonds in a market crash". Uncorrelated means its price does not move in step with them. They found gold played that role in extreme stock market conditions, but that "the safe haven property is short-lived".
A hedge is a looser idea. It only needs to be uncorrelated with shares on average. This guide asks the safe-haven question: what did gold do while shares were falling?
Gold pays no interest or dividends. So its price rests on demand and on the interest given up by holding it. We cover those forces in What Drives the Gold Price?
How we tested gold against stock market falls
We use two measures of gold. The first is GLD, a fund that holds gold bars. It began trading on 18 November 2004, so it gives daily prices from then. The second is the World Bank's monthly average gold price, which reaches back much further.
A fall runs from a record closing price to the lowest close before the record is beaten. We explain this measure in What Is a Drawdown? SPY's prices count dividends, while GLD pays none.
For each SPY fall of 10% or more, we measure GLD over the same dates. Falls in 2010 and 2011 are not separate cases. SPY was still below its 2007 record then, so they sit inside the 2007 fall.
GLD vs SPY in every stock market fall of 10% or more since 2004
Source: YX Insights
The chart shows SPY's seven falls of 10% or more since GLD began. Beside each, it shows GLD's change over the same dates. Over each whole fall, GLD lost less than SPY or gained.
GLD rose over four falls. The biggest gain was 23.9%, from October 2007 to March 2009. It also rose 12.6% in 2015 to 2016, 5.0% in late 2018 and 1.6% in early 2025.
GLD fell over three. It lost 2.4% in early 2018, 3.6% in early 2020 and 7.3% in 2022. The median change across all seven was a rise of 1.6%.
The gold price in S&P 500 falls since 1971
For a longer view, we use monthly averages. They smooth out sharp moves inside a month. The S&P 500 series comes from Robert Shiller of Yale. The gold price comes from the World Bank Pink Sheet, its monthly commodity price file.
We start in 1971 for a reason. Until 15 August 1971, foreign governments could swap dollars for gold at a fixed price of $35 an ounce. After that, the gold price moved freely.
Source: Robert Shiller, Yale; World Bank Pink Sheet; YX Insights
The chart shows the five S&P 500 falls of 20% or more since 1971, high month to low month. On monthly averages, the gold price rose in four of them:
1973 to 1974: the S&P 500 fell 43.4%, while gold rose about 183%, from $65 to $184 an ounce. The Consumer Price Index, the main US measure of inflation, rose 21.8% over the same months. Is Gold an Inflation Hedge? covers that link.
1987: the S&P 500 fell 26.8%, while gold rose 5.4%.
2000 to 2003: the S&P 500 fell 43.7%, while gold rose 31.0%.
2007 to 2009: the S&P 500 fell 50.8%, while gold rose 22.4%.
The gold price fell in one. From December 2021 to October 2022, the S&P 500 fell 20.3%, while gold fell 7.0% on monthly averages. GLD's daily prices give 7.3% for its own 2022 dates.
The 2020 fall in shares was 19.1% on monthly averages, so it is not in the list.
Over whole falls, GLD mostly held up. Partway through some falls, it did not. The table shows GLD's deepest fall inside each of SPY's seven falls, on daily prices.
SPY fall, high to low | SPY | GLD, same dates | GLD's deepest fall inside those dates |
|---|---|---|---|
9 Oct 2007 to 9 Mar 2009 | −55.2% | +23.9% | −29.4% (17 Mar to 12 Nov 2008) |
20 Jul 2015 to 11 Feb 2016 | −13.0% | +12.6% | −11.7% (14 Oct to 17 Dec 2015) |
26 Jan to 8 Feb 2018 | −10.1% | −2.4% | −2.6% (26 Jan to 7 Feb 2018) |
20 Sep to 24 Dec 2018 | −19.3% | +5.0% | −2.7% (26 Oct to 12 Nov 2018) |
19 Feb to 23 Mar 2020 | −33.7% | −3.6% | −12.5% (9 Mar to 19 Mar 2020) |
3 Jan to 12 Oct 2022 | −24.5% | −7.3% | −21.0% (8 Mar to 26 Sep 2022) |
19 Feb to 8 Apr 2025 | −18.8% | +1.6% | −5.0% (2 Apr to 7 Apr 2025) |
Source: YX Insights
The biggest drops came in 2008, 2022 and 2020.
Source: YX Insights
The chart follows both funds from SPY's high on 9 October 2007 to its low on 9 March 2009. GLD first rose 35.7%, to a peak on 17 March 2008. From there, it fell 29.4% to 12 November 2008. SPY fell 32.1% over those same dates.
At its November 2008 low, GLD was 4.2% below where it started in October 2007. It then recovered to end the period 23.9% higher. On monthly averages, the gold price fell 21.4% from March to November 2008.
The World Gold Council, a body formed by gold mining companies, notes that gold fell "between 15% and 25% in US-dollar terms a couple of times during 2008".
Real interest rates jumped while gold fell. A real interest rate is the return on a safe bond after inflation, explained in What Is a Real Interest Rate? We measure it with the yield on 10-year US government bonds that adjust for inflation. That yield rose from 1.05% on 17 March 2008 to 2.79% on 12 November 2008.
March 2020 was faster. GLD fell 12.5% from 9 to 19 March 2020, while SPY fell 12.3%. The World Gold Council wrote on 19 March 2020 that gold had "likely been used to raise cash to cover losses in other asset classes".
In 2022, GLD fell 21.0% from 8 March to 26 September. Over those dates, the same real yield rose from −1.04% to 1.56%. The Federal Reserve began raising interest rates in March 2022.
On single bad days, GLD's record was close to even. On SPY's ten worst days since November 2004, GLD rose on six and fell on four.
SPY fell 3% or more on 78 days. GLD rose on 40 of them. Its mean change on those days was a rise of 0.17%.
Over all days since 2004, the correlation between the two funds' daily returns was 0.07. Correlation runs from 1, for moving in perfect step, to −1, for moving in opposite directions. A reading near 0 means almost no link.
Across all days, that fits the hedge idea above. The safe-haven test is what gold did during the falls.
How to read gold's safe-haven record
A few points help:
Start to end hides the middle. GLD often ended a fall higher, but it dropped sharply partway through the 2008, 2020 and 2022 falls.
Check the measure. Daily fund prices and monthly averages give different figures for the same months.
Gold has deep falls of its own. GLD fell 45.6% from August 2011 to December 2015 and did not regain its high until July 2020. Will the Gold Price Go Down? covers gold's own falls.
Real interest rates matter. In 2008 and 2022, GLD's drops came as real yields rose.
Fund costs. GLD charges a fee each year, covered in How Do Gold ETFs Work?
For how often shares fall in the first place, see Will the Stock Market Crash?
Gold held its value over most big stock market falls since 1971. It was a safe haven over whole falls more often than inside them, as 2008, 2020 and 2022 show.
Learn more with YX Insights
This explainer is part of the YX Insights Academy. Each one takes a single idea and checks it against real data.
The same approach runs through everything else we publish:
Systematic Portfolio: ready-made portfolios for Macro & Megacaps and for Commodities. We publish the holdings and every change.
Multi-model Signals: a daily long-or-flat call on every name we cover. Each call shows how strongly our four models agree.
Research: company deep dives, macro commentary and essays on how we test.
Good places to start on the website:
Academy: more explainers like this one.
Start here: get our free weekly letter by email.
Macro & Megacaps Systematic Portfolio and Commodities: the two portfolios in detail.
Track record: live results since 3 August 2026, plus the ten-year backtest.
Upgrade: get the Systematic Portfolio, Multi-model Signals and research in full.
Common questions about gold as a safe haven
Does gold go up when stocks go down?
Often, but not always. Since November 2004, SPY (the S&P 500 ETF) fell 10% or more seven times. GLD (the gold ETF) rose over four of those falls and fell over three. On the 78 days SPY fell 3% or more, GLD rose on 40.
Did gold go up in the 2008 crash?
Yes, over the whole fall, but not all the way through. From 9 October 2007 to 9 March 2009, SPY fell 55.2% while GLD rose 23.9%. Inside that period, GLD fell 29.4% from 17 March to 12 November 2008, as real interest rates rose.
Why did gold fall in March 2020?
The World Gold Council wrote that gold had likely been sold to raise cash to cover losses elsewhere. GLD fell 12.5% from 9 to 19 March 2020 as shares fell. GLD then rose again. Over SPY's whole fall from 19 February to 23 March 2020, GLD lost 3.6%.
Does gold protect against a stock market crash?
Over most whole falls, yes, but it can fall sharply partway through. Since 1971, the S&P 500 fell 20% or more five times. On monthly averages, the gold price rose in four, while it fell 7.0% in 2022. GLD's daily prices give a 7.3% fall over SPY's 2022 dates.
DISCLAIMER: This article is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.