Gold has been considered a store of value for thousands of years. In 2026, it’s been trading more like a meme stock than a safe haven.
Investors often flock to gold when crises hit, inflation spikes or stocks slump as a way to preserve their money’s worth.
But gold prices have been extraordinary volatile, smashing through record highs before posting their biggest single-day drop on record last month. Gold is now up roughly 15 per cent this year.
Gold has had monster rallies before: Its best year on record was 1979, rising 144 per cent as the US economy experienced rampant inflation and geopolitical tensions surged. And prices rallied 24 per cent in 2020 as the pandemic upended the global economic status quo.
This time, gold is benefiting from rising geopolitical tensions. And as traders bought more, the gains gathered steam, resulting in skyrocketing prices.
Investing in metals is easier than ever before: Traders can buy and sell exchange-traded funds that track the price of gold and silver just like buying and selling stocks. The SPDR Gold ETF — a popular fund that tracks the performance of physical gold — in August saw its biggest monthly inflows on record, according to FactSet data.
U.S. markets in recent years have experienced bouts of so-called meme stock mania, where traders pile into a hype-fueled rally to try and ride a surge in a stock’s share price. Analysts say a similar theme is playing out in the metals market: Gold and silver have been trading like meme stocks.
A golden opportunity
Gold rose 27 per cent in 2024 and 67 per cent in 2025. The yellow metal hit US$4,000 a troy ounce for the first time in October before eclipsing US$5,000 in January.
“I think there was a wide range of different hedgers, speculators, hedge funds, retail traders, they were all kind of moving aggressively in and actually driving the prices higher than we would have expected and beyond the point where it was sustainable to hold,” said Joe Cavatoni, senior market strategist and head of U.S. public policy at the World Gold Council.
Despite posting its biggest single-day drop on record on Jan. 30, gold is still up this year. But the recent volatility has made some analysts wonder if gold still has the same luster as an investment.
Meanwhile, bitcoin has dropped 50 per cent since hitting a record high above US$126,000 in October. Traders who had chased bitcoin’s rally could have shifted focus to metals, analysts say, helping fuel the volatility.
“It is distorting gold’s historic role as a haven. It’s now trading like a momentum-driven market at the extremities of the risk asset spectrum,” David Scutt, market analyst at Forex.com, said in an email.
The fundamental outlook remains positive for gold, economists say. JPMorgan Chase expects gold prices to hit US$6,300 a troy ounce by the end of 2026.
While traders are trying to cash in on the rally, geopolitical uncertainty persists, boding well for gold prices.
Historic volatility
Silver has also experienced extraordinary volatility. Silver prices more than tripled across the past year before plunging 31 per cent on Jan. 30 and posting their worst day since 1980. Silver is still up roughly 138 per cent across the past year.
Gold on Tuesday jumped 6.07 per cent and had its best day since 2009 just two days after having its worst day on record.
The Cboe Gold Volatility Index surged this year to its highest level since the Covid pandemic in 2020, reflecting the intensity of the metal’s recent volatility.
“It’s hard to justify calling something a hedge when it has double-digit swings,” Steve Sosnick, chief strategist at Interactive Brokers, told CNN. “Your hedges are not supposed to be the most volatile portion of your portfolio.”
“When you see these kind of declines, they’re spectacular, they’re painful,” he added, “but they’re in some ways the natural outcome of hyper-aggressive speculation.”
