Some institutions hold gold as a long-term part of their reserves or investments rather than trading it. Their stated aims are usually diversification and preserving value — but gold can fall in value and pays no income.
Equities and fixed income remain the main holdings for most institutions. With correlations shifting and real interest rates changing, some are re-examining the role of physical assets like gold.
How Gold Is Discussed in Multi-Asset Planning
Correlation
Over the past two decades, gold’s correlation with the S&P 500 has been low on average. That is why it is discussed as a diversifier. Correlations change, however, and gold can fall at the same time as other assets.
Value Over Time
Unlike bonds, gold has no issuer and so no credit risk. Its supply is limited. But its price is driven by many factors, and it has had long periods of decline.
Liquidity
Physical gold is widely traded and recognised. With EONA, allocated gold is held with Loomis in Dubai and can be sold back to EONA at the price shown on the platform.
Institutional Trends
Some sovereign funds, pension plans and endowments hold gold. According to World Gold Council data, central banks bought over 1,000 tonnes of gold in 2023 — one of the highest annual totals on record.
How much any institution holds varies widely and depends on its mandate and advice. EONA does not suggest allocations or give investment advice.
Short-Term vs. Long-Term Approaches
Short-Term
Some buyers respond to short-term events such as inflation spikes or geopolitical instability. Gold does not reliably rise in such periods, and short-term price movements can be large.
Long-Term
A long-term approach treats gold as a lasting part of reserves rather than a trade. It does not remove price risk, and outcomes depend on the price when the gold is eventually sold.
How EONA Works
EONA lets institutions buy allocated physical gold, recorded against specific bars and stored with Loomis in Dubai (Zurich and Singapore are planned, coming soon). Prices are based on the international spot price plus a premium, with a commission. EONA sells on an execution-only basis.