July 8, 2021 | Stamford, CT — Institutional investors are positioning portfolios for an unprecedented transitional period as the global economy reawakens.

To understand investor strategies during this important period, Coalition Greenwich, in conjunction with the World Gold Council, interviewed approximately 500 institutional investors around the world about their portfolios, allocations and views on markets, gold and other individual asset classes.

“The study results show that institutional investors face a new set of challenges as they position portfolios for the post COVID-19 period,” says Andrews McCollum, Head of Investment Management at Coalition Greenwich and author of Rethink, Rebalance, Reset: Institutional Portfolio Strategies for the Post-Pandemic Period. “Among the most important challenges are how to protect their portfolios from mounting inflationary risks, and a desire to diversify their portfolios to protect against a severe market correction and other tail risk.”

Study findings reveal the strategic role gold has as a tool in managing risk from inflation to diversification is growing in prominence:

  • Nearly 40% of current gold investors expect to increase their allocations in the next three years 
  • 4 in 10 institutional investors who do not have gold exposure plan to make an investment in that timeframe 
  • Less than 8% of current investors plan to reduce allocations

The findings reflect a substantive shift as 1 in 5 institutions have specific allocations to gold in their portfolios. Allocations are most common among institutions in EMEA (29%) and notably, among the world’s biggest institutions, or those with more than $10 billion in assets (27%). The average allocation for investors who currently own or include gold in their policy portfolio is 4%.

“The findings underscore what we have been hearing from investors: due to a variety of macroeconomic factors, they’re faced with an unprecedented market landscape. Wise investors are responding with diversification, and gold has an important role to play within that diversification strategy,” said Matt Mark, Global Head of Institutional Sales, World Gold Council.