Stocks, bonds, and gold: a 3-way split over 15 years?
This page compares 15 years of steady monthly investing into stocks (SPY), US aggregate bonds (AGG), and gold (GLD), using the comparison calculator. Because each asset's drawdowns hit at different times, it shows how overall volatility can be eased.
Investment conditions
Asset · Stocks (SPY) - US Aggregate Bonds (AGG) - Gold (GLD)
Method · Comparison
The key is that because the three assets' drawdowns do not always overlap, holding them together can ease overall portfolio volatility. This does not mean it 'removes losses,' however—there are phases, like 2022, when multiple assets fall at once. In the comparison calculator, check each of the three assets' ending balance, maximum drawdown, and recovery period, and see how overall volatility changes when they are held together. The useful framing is that diversification is a tool for managing the character of volatility and drawdowns, not for maximizing return.
Open in comparison calculatorWhy this period and asset
Stocks, bonds, and gold are often cited as a classic diversification mix because their characters differ. Stocks (SPY) are a growth asset that has trended up with the economy and earnings; aggregate bonds (AGG) are sensitive to rates but comparatively low in volatility; gold (GLD) pays no interest or dividends but moves differently in crises and inflation. Over the past 15 years, the three did not always move in the same direction at once. In the early 2020 pandemic or the 2022 inflation phase, for example, each asset's drawdown timing and depth differed. That said, there were exceptional phases, like 2022, when stocks and bonds fell together.
Caveats & limits
This comparison reflects one specific past period, and results can change with the start or end date. Diversification does not always prevent losses, and multiple assets can fall together, as in 2022. Past performance does not guarantee the future. In real investing, fees, taxes, and exchange rates (for dollar-denominated assets) affect outcomes. This page recommends no purchase; it is educational material comparing character.
Data sources & limits
- Trading fees and taxes are not reflected — figures are pre-tax.
- Based on historical data; does not guarantee future returns.
Frequently asked questions
Which of the three assets is better?
None is always better. The three differ in character, so leadership varies by phase. The focus here is not 'which one is better' but how overall volatility is eased when they are held together. Check with the comparison calculator.
Does holding all three remove risk?
No. Diversification is a tool for managing the character of volatility and drawdowns, not for removing losses. Since there were exceptional phases like 2022 when stocks and bonds fell together, check each asset's maximum drawdown too.
What should I use as the basis for comparison?
Look beyond each asset's final return to maximum drawdown, time underwater, recovery period, and how overall volatility changes when they are held together. The point of diversification is easing volatility, not maximizing return.
Related scenarios
📋 Results are based on historical data; past returns do not guarantee future returns.
📋 This service is provided for educational purposes to help you understand investing, not as investment advice.
⚠️ Volatility and risk levels differ by asset, so returns alone cannot determine which is better.