Even as silver prices have outperformed gold in percentage terms in over a year, billionaire investor and Bridgewater Associates founder Ray Dalio remains firmly bullish on gold. He believes that gold is not a speculative trade, but a structural bet as the global monetary order is breaking down.
After outshining gold rates last year, silver price outperformance continues in 2026 as well on a month-to-date basis. Silver prices have risen 37% in the domestic spot market in January so far, as against a 16% rise in gold. Last year, both precious metals recorded their best gains since 1979.
Gold’s rise reflects stress in the monetary order
According to Ray Dalio, the global monetary order, made up of fiat currencies and debt, as a store of wealth, is not being held by central banks in the same way. Central banks, sovereign wealth funds and others are buying gold as a diversifier.
Dalio told CNBC at Davos 2026 that both the holders of US dollar denominated debt and the United States are worried about each other. And due to the trade wars unleashed by US President Donald Trump, Dalio says that we cannot ignore the possibility of capital wars. "In other words, maybe there's not the same inclination to buy US debt," he cautioned.
This, Dalio says, helps explain why gold has quietly become one of the best-performing major asset classes over the past year, outpacing even technology stocks and contributing to the underperformance of US markets relative to overseas peers.
“Gold is not a metal to speculate on,” Dalio told CNBC at Davos 2026. “It is the second-largest reserve currency.”
Historically, Dalio said that during times of conflicts and international geopolitical conflicts, even allies do not want to hold each other's debt and prefer hard currency — a pattern that has been repeated over centuries.
While silver’s rally has grabbed headlines due to its sharper price moves, Dalio believes gold’s strength is more meaningful because of who is buying it. Central banks, sovereign wealth funds and official institutions — particularly outside the US — have been steadily increasing their gold holdings.
How much gold should investors hold?
Dalio believes gold is an effective diversifier and, regardless of the price, it should form 5% to 15% of an investor's portfolio — a stance he has often repeated.
Dalio believes that gold performs very well when other assets do not. "It's an effective diversifier. So if you had no views of the markets, that's what you would have."
He also argues that central banks, on average, still hold less gold than they ideally should, even after the recent accumulation. Despite the rally, official positions remain “short of gold” relative to historical norms, Dalio told CNBC,
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