There has been much talk recently about adding gold to portfolios, especially as insurance against global financial catastrophe.  But is there academic evidence supporting this decision?

In a recent post on the Fama/French Forum, Professors Fama and French say there may be some diversification benefit in adding gold, however, they do not accept that past performance is a good indicator of future performance.

This posting caught the attention of guest host John Budden, and was the subject of this week’s Science of Investing interview.  Have a listen.
 

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