Gold as a portfolio hedge amid fiscal and geopolitical risks (with Jonathan Ferro, Annmarie Hordern)

implicit

RUT

Oil

explicit

USD

BlackRock 9.5
Asset Manager $10500.00B
Russ Koesterich 9.0

Gold as a portfolio hedge amid fiscal and geopolitical risks (with Jonathan Ferro, Annmarie Hordern)

metals

Gold works in a portfolio... Gold is generally going to do well in those environments... There's also a broader rally going on in many commodities... this support for metals, not just precious metals... That's the start of the continued. He explicitly endorses gold as a hedge and notes a multi-year infrastructure trend supporting metals. The context is the current explosive price move, which he does not call overvalued.

8 calls

no reliable edge (random outcomes)

1/20/2026 11:06:19 AM	short term cautious up	5 days later	+9.79%	+4.90%
1/6/2026 11:52:28 PM	medium term up	20 days later	+25.47%	+25.47%
10/14/2025 10:29:12 AM	medium term up	20 days later	-10.62%	-10.62%
10/8/2025 12:30:20 AM	short term sharp up	5 days later	+4.31%	+6.47%
9/3/2025 10:22:34 AM	medium term up	20 days later	+5.95%	+5.95%

Show all 5 metals results

ndx

While not giving a direct forecast, his commentary on the US economy is constructive (inflation heading right direction, no stagflation, ability to build attractive portfolios). He discusses equities and gold moving together in 2025, implying a non-negative view on equity performance. The overall tone suggests a positive backdrop for risk assets like the NDX.

yields

Koesterich states US 10-year yields have not broken out of their range despite events in Japan, US bond volatility is low, and factors supporting the US bond market (dollar hegemony, disinflation trend, attractive yield) remain in place. This implies a view of stability or modest downward pressure on yields in the near term.

Introduces Russ Koesterich to discuss gold breaking through $5,000 and what's next.

Jonathan Ferro
Russ Koesterich

There's no objective way to value gold; its value is what people are willing to pay. It works in a portfolio as a hedge against fiscal issues in developed countries and growing geopolitical risk.

Unlike other assets, you can't say it's overvalued. It's one of the few assets that actually hedges those types of risks.
Asks if gold's move is a hedge against dollar weakness or something more.

Jonathan Ferro
Russ Koesterich

It is a hedge against dollar weakness. Post-COVID, longstanding correlations have broken down. Gold moving opposite the dollar is a fundamental correlation that holds. If you worry about US debasement or debt, gold does well.

For a long time, bonds hedged equities, but that's less stable now. The gold-dollar inverse relationship is expected to keep holding up.
Russ Koesterich

Equities and gold have not been that negatively correlated. In 2025, they've moved together. Gold is a portfolio diversifier, not necessarily a day-to-day hedge for stock market fluctuations.

You can't assume if S&P futures are down 1%, gold will be up. It's effective for long-term risks like US debt, not daily stock moves.
Asks if, given risks aren't going away, he will add to his modest gold position.

Annmarie Hordern
Russ Koesterich

We're probably where we want to be. Gold can go down abruptly, as in 2022. In a classic 60/40 portfolio, a 3-5% position works well to compensate for hard-to-quantify risks.

The exact percentage depends on what else is in the portfolio.
Asks if silver's tear bodes well for the entire commodity complex.

Annmarie Hordern
Russ Koesterich

Gold and silver are moving in tandem; silver is also a precious metal hedging risk. There's a broader rally in many commodities, like copper tied to electrification.

We're in an environment with geopolitical/debt concerns and a significant infrastructure build-out (data centers, grid, power), which is a multi-year trend supporting metals.
Asks for his takeaway from the convulsion in Japanese government bonds, referencing Ken Griffin's warning about bond vigilantes.

Jonathan Ferro
Russ Koesterich

The move in Japan has been dramatic, but it's not a shock given Japan's exit from deflation and new prime minister using fiscal stimulus. Interestingly, despite Japan, US 10-year yields haven't broken out of their range, and US bond volatility is low.

There are concerns about the long end of the curve and term premium, but spillover to US bonds has been relatively stable.
Asks what's insulating the US bond market from the rupture in JGBs.

Jonathan Ferro
Russ Koesterich

Spillover effects aren't always dramatic. Factors supporting US bonds remain: no obvious short-term dollar replacement, inflation heading in the right direction, no stagflation, and opportunity to pick up yield in credit markets.

For the first time since the mid-2000s, you can build a high-yielding portfolio without taking a lot of credit or duration risk, which is attractive to clients.

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