What Investors Should Consider Before Adding Gold Assets to Their Portfolios with David Hathaway – Ep 094

For many investors, 2025 has raised difficult questions about safety, inflation, global instability, and how to protect wealth in an increasingly unpredictable environment. With gold posting some of its strongest performance in decades, many are wondering whether it belongs in their portfolios.​

So today, SHP Financial’s Matthew Peck is joined by Senior Portfolio Analyst David Hathaway to break down the factors behind gold’s surge. From geopolitical tensions to inflation concerns, David explains why gold has historically served as a store of value, how it behaves in crisis periods, and why it often shines when uncertainty is at its highest.​

In this conversation, you’ll also learn how investors can actually access gold, whether through ETFs, physical metals, or alternative allocations; what percentage ranges may make sense inside a diversified portfolio; and how SHP evaluates when to introduce or increase exposure. ​

Matthew and David also compare gold with assets like Bitcoin and discuss its role in alternative investments. They outline why a disciplined, research-based approach—not a fearful approach—is essential when evaluating gold’s place in long-term planning.

In this podcast interview, you’ll learn:

• The forces driving gold’s surge in 2025, including geopolitical tension and central bank buying.
• How inflation pressures, weakening currencies, and rate cuts often boost demand for gold.
• The most common ways to invest in gold and why ETFs are typically the most efficient.
• Typical allocation ranges for gold and how it fits within an alternatives bucket.
• How gold differs from Bitcoin in correlation and diversification benefits.
• Why SHP uses a careful, research-based process before adding or increasing gold exposure.

Inspiring Quotes

• “Since the inception of the very first gold ETF that launched in 2004, gold has actually outperformed the S&P over that same time frame, which goes against conventional wisdom.” – Dave Hathaway

• “ I think of gold and I think of shiny things and it’s like, ‘Whoa! This is a major player in international finance and international politics.” – Matthew Peck

• “Gold shines in these years of heavy volatility, of heavy uncertainty, of monetary issues and fiscal issues that we’re seeing.” – Matthew Peck

Interview Resources

• Warren Buffett

[INTERVIEW]

Matthew Peck: Welcome, everyone, to another edition of SHP Financial’s Retirement Roadmap Podcast. I’m your host today, Matthew Peck. Today, we’ll be talking about gold, gold as an investment, gold as a diversifier, what role does it have in portfolios, and why has it surged so much in 2025? To look into some of these answers, we hauled in one of our top analysts at SHP Financial and soon-to-be father of a second baby in a couple of months, David Hathaway. He’s, obviously, a returning guest and very helpful in portfolios itself, and hopefully we’ll be able to answer some questions for all of our listeners as to why gold and the role it plays. So, without much further ado, Dave, welcome back to the podcast.

David Hathaway: Yeah. Thank you very much for having me.

Matthew Peck: And I was going to say, so I know we have a baby coming. It’s a baby boy or baby girl?

David Hathaway: Yep, boy number two. Yeah.

Matthew Peck: Oh, man.

David Hathaway: Coming in December. Very excited.

Matthew Peck: Alright. Well, certainly on behalf of everyone here, we’re certainly excited about that. I mean, we need more Hathaways in this world.

David Hathaway: I think so.

Matthew Peck: Well, I love it. All right, my man. So, let’s talk a little bit about gold. I mean, when people ask you about gold, how do you generally respond? Like, what’s the first thing that you like to tell people about gold as an investment?

David Hathaway: I’d say, first off, it’s been a store of value historically. Going back to ancient times, gold coins, that was the first sort of money that people transacted with. And it’s remained a store of value even today. And the way in which we invest in gold and transact in gold has obviously changed and modernized through the years, but it still remains very important. We see, in modern times, central banks all around the world are buying gold as fast as they can. China especially, Poland, India are just a few of the countries that have been really aggressive with buying gold, and they’re doing it so it’ll be a store of value for them.

Matthew Peck: Okay. So, to really start off, number one, when we talk in terms of gold, I mean, it’s store of value, meaning that people will then sort of seek it out, not just for pretty things, like bracelets and earrings and whatnot, and rings and whatnot, but to truly make sure that that investment, like what they buy, is going to be there tomorrow. And I think it’s good for people to understand what store of value means because think of it this way, it’s like if you buy a stock in a company and you pay $50 for that stock, and that company goes bankrupt, that $50 is gone.

David Hathaway: Exactly. Yeah.

Matthew Peck: Right? So, you can’t say a company’s a store of value because there’s a good chance, depending on the company, of course, that the $50 that you invest in a share is gone. Or even if you buy their bonds, which is basically like a lending, like a debt instrument. Same idea. If they go bankrupt, that money’s gone. So, you can’t really say those types of investments are true stores of value, whereas gold, at least that’s the anticipation, right? That’s the expectation that, okay, if I buy $50 worth of gold bars or whatever that may be, that 50 should always be there for me in some way, shape, or form because gold has been sort of treated that way for a millennium.

David Hathaway: Yeah, exactly. It’s got industrial use cases. You can find gold in circuit boards. Obviously, it’s in jewelry. So, there’s always going to be some sort of demand for the metal. Outside of it just being a monetary store value, it also has other applications as well. And so, I think that keeps the price up, and at some level, it’s never going to go to zero, let’s say.

Matthew Peck: Okay. So, you mentioned too, or we always love to talk about how not everyone is a fan of gold, right? I mean, Warren Buffett, he’s probably the most famous, one of the best investors, if not the best investor of all time. Certainly, one of the more famous ones. He never liked gold. So, why didn’t Buffett like gold? And then why do people? Why do some dislike it? And then sort of argue on both sides.

David Hathaway: And I was kind of in that camp for a long time, too. Basically, it’s because gold doesn’t produce anything. It doesn’t do anything. It’s not a company that’s producing widgets and giving investors dividends and rebuying shares. So, it’s not really involved in sort of the wealth generation machine. But despite all that, gold has continued to do very well. I think we were looking at a stat earlier since the 70s. It’s up about 8% per year, since 1971. So, despite some of the challenges of not really producing any cash flow, the way things have worked out, gold’s done very well. I was looking at another stat earlier. Since the inception of the very first gold ETF, exchange traded fund, the ticker on that is GLD, that launched in 2004, gold has actually outperformed the S&P over that same time frame, which goes against conventional wisdom.

Matthew Peck: Well, I think, because that’s one thing I love to point out, is the fact that, okay, so you said 2004 to today, right?

David Hathaway: Yeah.

Matthew Peck: So, where gold has technically outperformed the S&P 500, which is, as you couldn’t even wrap, when you sent that stat to me, it’s like, “No way that gold would be better than the NASDAQ and the S&P.” I’m not sure about the NASDAQ, but specifically the S&P 500. But in that 2004 to today lies the answer to why it would do that, which is number one, you have 2008 and 2009, and then you had COVID in 2020, right? So, I love studying gold, mainly because it really becomes a historical study. It shines in these years, oh, no pun intended, but actually, I’ll go with it, but it shines in these years of heavy volatility, of heavy uncertainty, of monetary issues and fiscal issues that we’re seeing.

So, you’re starting a feel for it, because in 1979, during the energy crisis in the inflation spike, so this was outside of the years that we were originally quoting. In 1979, during the inflation and energy crisis, it’s up 126%. 2020 was up 27% in 2020. So, you get the idea that during those crises is when gold really, really stands out. And so, tell us about 2025. So, why is 2025 on that list now of some of the best-performing years for gold?

David Hathaway: Yeah, I think a number of factors are going on. Geopolitical uncertainty. It seems like the administration is implementing all these changes really fast, and I think that has given investors around the world some concern and sort of a flight towards safety. Our national debt has increased about $2 trillion just this year alone. You have some inflation concerns. Just yesterday, Trump was talking about $2,000 stimulus checks being sent out to individuals. That’s very inflationary, and so gold has also been viewed as an inflation hedge. And so, that would only spur the price of gold further higher. There was something else. I lost it.

Matthew Peck: That’s okay. I mean, I can bring it back to kind of talk about each one of those things, right? So, first, let’s talk about central banks. For years, and still to this day, the dollar is the dominant currency that the world sort of trades on. Oil is traded in dollars, and a majority of major global transactions, dollars are exchanging hands. And so, now let’s say you are a central bank, and we’re seeing a new sort of more of a swashbuckling America-first type of president comes in, and you know that, “Okay, if I’m trading in dollars the entire time, and now I run afoul of the new administration, I may get kicked out of the dollar exchange.” Suddenly, “Dave, like, sorry, you’re not allowed to trade in dollars anymore because I’m America, and nope, you’re out. You’re a terrorist organization,” wherever that may be.

So, suddenly, like, “Wow, if I’m relying on dollars for my sort of country’s economy to move, that’s not really a stable foundation to build my economy on. So, what I’m going to do as a global bank or a national bank is I’m going to buy gold, because at least at that point in time, I have value. I have, again, that store of value where now I might be able to exchange dollars for gold, or whatever that may be. So, the impact on the global banks, and global instability, I think, is really, really key because the global banks are buying this gold because they want to make sure that all the different, the instability and some of the tensions that happen, that they’re not hurting the people that they’re protecting, if that makes sense.

David Hathaway: Yeah. I think that’s true. Also, back when Russia and Ukraine that conflict started, the US seized a bunch of Russian dollars. And I think that has caused other central banks around the world to reconsider, not necessarily that they’re going to go invading other countries, but at the same time, if that can be done to Russia, could it also be done to our country as well? So, I think that’s another reason to diversify away from dollars into gold.

Matthew Peck: Right. And I think that’s the biggest thing that I want to sort of convey with the conversation. We’ll talk about some of the logistics and how you actually invest in gold, but it’s more than just earrings and rings and crowns, because maybe that’s just my own sense of living in my own historical, geeky world. Like, I think of gold, I think of shiny things, and it’s like, whoa, this is a major player in international finance and international politics. And I think it really shows up in 2025. If we’re going into a world where there’s the sort of, who knows whether it’s a new order or whatever that may be, right? But you get the idea that there’s a lot of questioning of how the post-World War II rules were going to be, where we’re sort of transitioning, and whether it’s just a lurch and we go back?

But we had the World Trade Organization. We had all these rules-based trade that sort of being torn up right now and sort of reconfigured. And that’s the type of year that that gold is going to perform in, which is hence why it’s up again 60%, as of this recording, which is still, I mean, in one year as I mentioned about Buffett’s criticism, this isn’t a company. This isn’t a company making widgets, or this isn’t a company that’s sort of heavily part of the AI trade. This is a commodity. I mean, this is sort of a metal, but it reflects what’s happening in the world really, really well in that regard. Now, let’s talk a little bit about inflation, too, because it’s also a major impact of inflation. So, how does gold and inflation kind of interact?

David Hathaway: So, it’s historically been a hedge against inflation. So, when we talk about inflation, we’re talking about dollars losing value, essentially. There’s too much money in the system. Your dollar doesn’t go as far as it used to, but gold is sort of outside of that system. So, it has historically maintained its value regardless of what inflation is doing. And maybe that’s just perception that this is what gold does. So, let me go buy gold bars, but it’s just been able to handle that. The other thing I was going to say earlier…

Matthew Peck: It came back.

David Hathaway: Yeah. Sorry.

Matthew Peck: Baby brain. Sorry, everyone.

David Hathaway: The Fed is cutting rates. And so, that’s kind of related to the sort of inflation trade. As rates go down, generally the dollar decreases. And so, that’s, again, another bullish point for gold.

Matthew Peck: No, key point because actually, let me go back to the Fed cut, the Fed rates, and then I’m going to jump back to inflation, so a little hopscotch here. But in regards to the Fed rates, and I’ll go back to Buffett, and same idea, like, I should also say admittedly, I was not a gold bug at all coming into this year specifically. And I kind of was with Buffett. It’s like, “Well, why am I holding this thing that doesn’t pay me any interest in dividends,” right? Well, suddenly, if CDs and money markets and bonds are paying less interest, well, that’s now less appealing of an asset.

And gold suddenly becomes more appealing because now, rather than I’m getting 4% on a money market and gold is giving me zero, well, if money market’s paying me 2% and gold is providing all of this inflation protection and sort of Safe Harbor, well again, gold becomes a lot more appealing at that point when it’s a 2% versus a 4% swing on the interest rate. To come back inflation, I mean, you gave a term of $2 trillion in debt, part of which is why it’s really like a perfect storm for gold this year.

David Hathaway: Yeah, it really has been.

Matthew Peck: I mean, because think of it this way, we’re adding trillions of dollars. Neither party is talking about austerity or raising taxes or controlling debt, that it’s sort of in every one of our quarterly market updates. We talk about how concerned we are at the long-term fiscal outlook, and they’ll say, “Okay, we’ll grow our way out of this debt,” and that’d be great. I really, really hope that they do for everyone’s sake. But if they’re unable to grow their way out of this debt, inflation is what governments have done historically to make it easier to pay off their debts. So, for everyone, these global investors that are just saying, “Well, gosh, they’re adding $2 trillion.” Well, what happens if they can’t grow their way out of it?

Well, the only other way out of it is inflation. So, let me again buy this gold because they’re going to weaken the dollar. And if the dollar is weak, then gold will continue to hold that value, if the dollar isn’t holding the value. Do you see my meaning?

David Hathaway: Yeah. There’s no shortage of bullish points for gold for this year. Who knows? We did see some volatility a couple weeks ago. Price came down pretty substantially over a couple days, but then it’s kind of crawled right back up above $4,000. Earlier this year, Goldman Sachs had a price target of $4,000. Now they’re saying $4,900 an ounce. So, that target just keeps inching higher and higher.

Matthew Peck: Well, I think the longer that everything is happening in the news is probably, at least– I mean, and obviously everything’s cyclical. And I should also quickly state, this isn’t a recommendation for gold. Everyone’s situation is unique, just talk to your advisor, things along those lines. All right, this message is brought to you by the compliance department. But it’s a fact. It’s a fact. But okay, so with that being said, logistically, how do we invest in gold? I mean, are we like, do I have a pick and shovel? What am I doing? Am I panning?

David Hathaway: You are panning in your backyard for some gold. Yeah, there’s lots of ways.

Matthew Peck: I bought a lot of soggy, nasty leaves. It’s like, those are valuable.

David Hathaway: I don’t think there’s gold in there. So, there’s lots of different ways. Historically, folks have gone out there. There are people that or companies that will source gold for you, coins, bars, that sort of thing. Fidelity actually does have a physical gold department or physical metals department. The easiest way for most investors to access it is through ETFs.

Matthew Peck: Which are what? Just to explain.

David Hathaway: Exchange traded funds.

Matthew Peck: Okay.

David Hathaway: Most of those are backed by real physical gold. You would have to do a little bit of research to determine if it does have a physical gold backing. Most of the times, they do, but sometimes, they get there through options or something like that. So, physical gold can be purchased, exchange traded funds, futures. Exchange traded fund is really the easiest way,

Matthew Peck: Probably the most common way.

David Hathaway: Yeah.

Matthew Peck: Just because I know people do feel– they like the idea of gold bars. So, if you don’t mind, explain. So, someone would buy gold bars or they’d go to Fidelity and buy some, as an example, and then they would just give dollars, and now they have gold bars somewhere there. Is that kind of how it works?

David Hathaway: Yeah. Yeah, it can be kind of costly to exchange. If you ever want to get out, generally, you have to take a haircut on the price. It’s not, I would say, the most efficient way to own the metal. ETFs are by far the most efficient way too.

Matthew Peck: Okay, which is interesting.

David Hathaway: To participate.

Matthew Peck: Well, it’s funny, I was going to say, Dave, it’s interesting because we normally explain exchange traded funds. Well, they’re funds, which means they’re diversified. And let’s say the S&P 500 is an exchange traded or can be an exchange traded fund, and that’s 500 companies, but all packaged into one fund and one ticker that you can trade. So, golds, even though it’s not really diversified, it’s just gold within that fund. But an exchange traded fund is the easiest, most convenient way to get involved.

David Hathaway: Yeah, I think so. Definitely.

Matthew Peck: Okay. And then, generally speaking, what do– I mean, I guess it might be different from an analyst than a financial advisor. And so, what are the ranges of allocations that you’ll hear in the industry when it comes to, okay, here’s how much you should have in gold, or if you’re considering gold, here’s a range to consider?

David Hathaway: Yeah, I think you’d probably want it as part of sort of a safety bucket. Again, it’s traditionally viewed as a store of value. So, maybe, it’s where you would have some of your bond allocation you could allocate to gold, 5% to 10% is the typical range. I probably wouldn’t go much higher. I probably wouldn’t go higher than 10%. This year has been great. Last year was great for gold, but going forward, we just don’t know what it’ll look like going forward. But I think it makes sense. Given what we’ve seen the last couple years, I think it does make sense to have a small allocation towards gold.

Matthew Peck: And actually, let me pick up on one point, then I’ll go back to sort of portfolio construction and kind of how SHP approaches it. The idea of these like surges, I feel like gold’s flat for a decade and then surges up and then it’s like flat for a while, then surges up. So, I mean, I guess most investments aren’t this straight line forward, of course, but I feel gold sometimes can be dormant and sort of goes to sleep for a bit. You don’t really see much action, and then next thing, it pops because the perfect storm sort of arises, whether it’s inflationary concerns, global bank buying, debt crisis, things along those lines. So, yeah, manage expectations really is my main point to all the listeners because it really is– I mean, any investment is long term or should be viewed. They, obviously, in our opinion, should be viewed as a long-term perspective.

Now, in regards to portfolio construction, you talk about 5% to 10% allocation. I know we have an alternative sort of portfolio. I mean, would you consider gold alternative? I mean, do you consider it? I mean, I guess what’s the correlation? Correlation means how much it moves for all the listeners. Correlation means how much gold will move with the S&P 500. So, if one zigs, does the other zag or do they move together? So, in your definition, where does gold fall into the overall? Is it an alternative? Is it a core position?

David Hathaway: Yeah, it’s traditionally viewed as an alternative investment with other hard assets like real estate, managed futures, that kind of thing. But it’s definitely an alternative investment. It’s not traditional.

Matthew Peck: Okay. Because on that end too, I mean, it’s funny, we’ve been having different podcasts on alternative investments, and whether it’s private equity, private credit. I think it’s kind of all building or I think portfolios just evolve through time, right? So, when we talk in terms of hard assets to real estate, as you mentioned, as you suggested, I think it kind of all falls under that category where if a client says, okay, hey, I want 10% in alts or alternatives, how should I break up that 10%? And then we start to really bring in the gold conversation.

One thing I did want to ask you about, because we talk about store of value and this term is also in the news a whole lot. So, as a teaser, I talk about correlation, right? I talk about, all right, if the S&P 500 zigs, does gold zag? The other comparison that we hear a lot is Bitcoin, where Bitcoin is digital gold, Bitcoin is the next store of value and things along those lines. So, how does Bitcoin and gold interact? And do you see it kind of in the exact same world? Or do you think it’s, whoa, that’s a completely different topic and a completely different type of investment?

David Hathaway: Yeah, it definitely has similar aspects of it, but they’re definitely different. Historically, Bitcoin has sort of tracked the Nasdaq and other tech stocks pretty well, really strong correlation between those two. Gold not so much, not correlated to the S&P, not correlated to the Nasdaq 100. So, it’s definitely giving you the diversification that you want out of your alternatives bucket.

Bitcoin hasn’t done that yet. It might someday detach from the Nasdaq, but we’ve not seen that happen in the last couple years. 2022 was a great example of that. Tech stocks took a substantial dip, and Bitcoin and other crypto went right along with it. Like I said, maybe that changes down the road at some point in the future, but as of today, it hasn’t proved to be a diversifier.

Matthew Peck: Yeah. And you mentioned 2022 and that’s why it took me a while to come around on gold because, I believe, 2022 wasn’t that good of a year for it. And I was thinking like, wait a second, if we have inflation, why wouldn’t gold do well in that aspect? But I think a lot of it also has to do with growth and obviously, our debt was a little bit lower at that point in time, but really, coming into 2025, it’s been remarkable of a rise.

David Hathaway: We were also raising rates in 2022.

Matthew Peck: Right, yeah, exactly.

David Hathaway: So, that’s not really the best environment for gold to perform. Cutting an easy Fed policy is definitely better for gold.

Matthew Peck: Yeah, that’s a great point. That’s a great, great point. Yeah, so I mean, it just shows, ladies and gentlemen, all the different factors that go in and I’m just– and generally, I certainly am glad everyone, hopefully is listening to the podcast, and I share that with you because I think, generally speaking, when clients will come in, when they ask about gold, it’s because they saw a TV commercial, some like infomercial on that’s late at night, and it’s like, oh, gosh, some guy hawking gold. And sometimes, it could be a little snake oily in a way. I mean, have you ever seen some of those?

David Hathaway: Oh, yeah, definitely. And generally, what they want to do is convert your entire portfolio into gold. And that’s not something that we would ever recommend. We want to keep a balanced approach to portfolio construction for our clients.

Matthew Peck: Right, because I mean, as much as we talk about the debt levels and global instability and things along those lines, I’m saying personally speaking, this was years ago, first looking into gold, I was like, wow, that’s a very bunker mentality, right? In the sense of, hey, the world’s going to pot, I better put my money here, and almost like a very pessimistic investment. Do you see what I mean?

David Hathaway: Yeah.

Matthew Peck: And I think, and literally, can be put in almost like a scary type of investment. Like, Dave, if you don’t do this, then all your money’s going to go on. And I think in terms of those commercials, and it’s like, whoa, okay, all right. We have to separate some of the fear. Or when you invest in gold, you have to have this type of information behind you as to why.

David Hathaway: Right?

Matthew Peck: Do you see what I mean?

David Hathaway: Yeah, yeah. We’re definitely taking an informed approach. The conditions in the world are ripe for gold right now. That might not be the case in two years. And I wouldn’t want to have most of my portfolio invested in gold for the rest of my life. I think we’re looking at conditions as they are today and we’re making bets on the price of gold today and maybe out a couple years, but it’s not something that we’re tied to.

Matthew Peck: Yeah, which is a great point because you think about the portfolio construction, I mean, like when the team first think about adding it to when they actually do add it, I mean, what’s a three-month process? I mean, I guess if you don’t mind explaining a little bit about how the sausage is made and inside baseball on portfolio construction and the sort of introduction of an asset like gold into SHP’s portfolios.

David Hathaway: Yeah. I mean, I think it starts small, obviously. We started with a fairly small position earlier at kind of the beginning of the year in our alternative’s portfolio and since we’ve increased that exposure in that portfolio, but we’ve also branched it out towards a couple other portfolios as well. So, I think it’s a slow process of testing the theory, kind of confirming what we believe, and then implementation into the portfolios.

Matthew Peck: Well, and I think we’ll kind of end on that in a sense, Dave, because it’s like, I want people, all the listeners to know, whether it is at SHP or whether they’re doing their own investment, investing, or whether they have a team on their behalf, and if you don’t have a team, obviously, reach out to SHP, of course. But you get the point where it should be a slow, deliberate, and well-thought-out investment strategy, right? And of course, it has to match your financial goals. It has to match what your income plan is and your tax plan and different things along those lines because tax-wise, actually, I’ll digress for a little bit. I mean, it’s pretty much gold is going to be taxed, like investment-wise, like any other investment. Pretty much. Especially, obviously, if it’s in your IRA.

But to get back to my point, guys, like we were talking about making sure that you don’t sort of follow crazies, and certainly, never sort of feared or you invest out of fear. We always want to make sure there’s no scare tactics going in. But when you look at the backdrop, like you were saying, Dave, I mean this is the type of backdrop that is the reason why gold is propelled as far as it has been. And so, as you were saying, whether it’s two years from now, we don’t know if those same conditions will be in place. So, you’re constantly reassessing the portfolios. You’re constantly making sure that where we are positioned, we have what are called tailwinds, right, that the portfolio is set to grow because those are the types of conditions that we’re looking for in, whether it’s gold or whether it’s real estate or whether it’s growth or whether it’s value. And those are just the portfolio. That’s why it’s constant where it takes constant work, right? Like, yeah, does it ever get old for you? Like, when did you first want to get into portfolios and all that stuff?

David Hathaway: I mean, I had an econ class in high school and I fell in love with this stuff, almost instantly. And it’s been something that I’ve pursued relentlessly ever since. So, I really enjoy it.

Matthew Peck: And it never gets old.

David Hathaway: No, never gets old. There’s always something new out there. There’s always price dislocations in assets, and discovering those, it’s a lot of fun.

Matthew Peck: Yeah. No, absolutely. And obviously, we’re very happy to have Dave here too. That type of relentless approach, we want that here at SHP. So, thank you all for listening. Certainly, if you have any questions, reach out to your advisor, or if you don’t have an advisor, please reach out to SHP Financial. Hope you found it interesting and be well.

David Hathaway: Thank you.

[END]