Is gold still all that glitters in 2026?

Whether you’re looking to diversify your investment portfolio, counter unpredictable geopolitical or fiscal conditions, chase growth – or all of the above – gold remains a hot topic among investors in 2026.

It’s been hard to miss the surging demand for gold in recent times. Over the two years to 26 January 2026, the price of gold – based on the ‘spot price’ at which it may currently be bought and sold – has risen sharply¹. 

Gold prices eased briefly at the end of last year, but the precious metal climbed again in late January to new highs, breaking USD$5000 (approximately AUD$7,230) per ounce for the first time. It then traded even higher for a few days before the price dipped back below USD$5000¹. 

However, as gold prices depend solely on demand, it can be volatile – as the variation in the gold spot price in recent weeks has shown. 

Source: Factset. Gold spot price in USD per ounce from 31 January 2025 to 30 January 2026.

Over time, gold has shown a tendency to hold its value and rise during periods of global uncertainty, with many investors viewing it as a long term portfolio stabiliser.

Gold is often used to help protect the value of money, such as when inflation is high and when economic conditions weaken – such as during the global financial crisis, which began in 2008, and the COVID-19 pandemic of 2020 (see charts below).

Sources: Bloomberg, S&P. Data normalised with percentage appreciation as of 31 December 1999. S&P 500 Total Return Index is calculated intraday by S&P based on the price changes and reinvested dividends. 

The current wave of demand for gold is broad-based, driven by increased buying from central banks, the Chinese retail market, western markets and exchange traded funds³. 

“All investors are concerned with protecting or growing the purchasing power of their money,” says Peter Labrie, Executive Director of the FirstChoice investment platform at CFS.

“Investing in growth assets like shares are a really important part of that – but when stock markets are at record highs, gold can provide diversification,” Peter says.

“People have tended to buy gold in times of high inflation, political instability, loose fiscal policies, sky-high stock markets and falling bond prices,” he adds.

However Peter cautioned that as gold doesn’t produce a yield, or make valuable products and services, it depends on investor demand and sentiment, which can be difficult to predict.

“Whether these conditions continue to prevail is anyone's guess,” he says.    

Investors typically invest in gold by buying:

• physical gold, such as gold bars and coins, or jewellery. While it’s a very tangible way to invest in gold, it requires safe storage, transport and insurance to protect your investment.
• gold backed ETFs and managed investment options. These offer exposure to the gold price without the need to store bullion. While fees apply, they offer ease of access and liquidity, or the ability to buy or sell quickly. In the case of the CFS Physical Gold option, it can also be monitored easily within your CFS investment account.
• gold related shares. The value of gold mining companies may rise alongside gold price rises. However, miners’ share prices may also be influenced by individual operating costs, debt levels, and market sentiment.

CFS customers who invested in our gold option, CFS ETF Exposure Series – Physical Gold, since its inception just over three years ago, have been among those to benefit from the growing demand for gold.

The option is growing rapidly as some CFS customers seek investment types that aren’t reliant on equity or bond markets for returns.

“Gold still represents a small percentage of customers’ investments on the FirstChoice platform,” Peter says.

Over the 12 months to 31 December 2025, our gold option – which invests in an exchange traded fund and aims to track the gold price before taxes and fees are deducted – delivered net returns of 50.7%², while annualised net returns since inception in November 2022 were 31.3%².

“Most customers investing in the CFS ETF Exposure Series: Physical Gold are using it as a satellite allocation as part of a diversified portfolio,” Peter adds.

“Advisers and customers make use of the FirstNet and CFS App to keep an eye on their investment allocations and can use the facilities that auto-rebalance regularly to stay within their target weights.”

Whether gold is right for any individual investor depends on your goals, your risk profile, and your broader investment mix.

As always, diversification remains key. Gold can play a helpful role as part of a balanced, long‑term investment strategy.