Fidelity's Thoughts on Gold

Diversification opportunities
Given its atypical characteristics, the performance
of gold has had little or no correlation to other asset
classes, such as stocks and bonds. As a result,
making an allocation to gold
may be an effective way to achieve diversification
benefits. So far this decade, a position in gold would
have provided a boost to a diversified portfolio, as
gold bullion prices soared 216%, while U.S. stocks
and bonds returned -36% and 75%, respectively.iii
However, gold has a history of being an extremely
volatile asset class. For example, throughout the
gold bullion bull market this decade, gold-related
stocks have had five corrections of at least 25%,
with a near 70% decline during the most recent
drawdown.iv As a result, maintaining only a small
allocation to gold might be a reasonable approach.