Gold Investment Calculator

Metals produce nothing. No dividend, no interest, no rent — the entire return is whether someone later pays more than you did. So, this tab is one thing compounded: a price assumption, less a yearly charge for storage and insurance. The charge is taken off the growth rate before anything compounds, which is why it costs more than it would otherwise. A dividend compounds for you year after year; a vault bill compounds against you the same way, and the results panel shows what that difference came to over your horizon.

The starting growth rate is 5.5% per year, and where you begin measuring determines that number more than anything else. Gold since 1928 works out near 5.1%, but that stretch includes decades when the price was set by law rather than by buyers. Measured from 1975, from 1985, or from 1990, it lands at 5.4 to 5.5% every time, which is why that is the default. Counting from 1971 gives 8.2%, though most of the gap is one repricing when the gold standard ended — gold rose 127% in 1979 alone.

The comparison against dividend stocks is enabled by default and uses the Stocks tab’s own assumptions, so the two agree. What it shows is rarely a contest about which price rose faster. It is that one asset paid you while you held it and the other charged you.

What the arithmetic leaves out starts at the moment you buy. Physical metal sells above the spot price and buys back below it, and on coins that spread can run several percent in each direction, so a holding must gain before it breaks even. An exchange-traded fund avoids the spread and the vault bill but charges a management fee instead, and the storage field is the place to put it. Nothing here distinguishes gold from silver or platinum, though silver behaves quite differently because half its demand is industrial.

One smooth rate is also the least realistic thing on this page. Metals do not drift upward; they sit still for years and then move violently, and an average conceals exactly the part that decides whether you were glad you owned any. Gold bought at the 1980 peak did not recover its purchasing power until 2008 — twenty-eight years, with the average over the whole period still looking respectable. There is no volatility fan here to show that, unlike the Stocks tab.

Two more things are missing. Metal is priced in US dollars, so a Canadian holder’s return includes the currency move, which this does not model. And in the United States, physical precious metals are taxed as collectibles at a higher rate than long-term capital gains, while the tax setting here applies the ordinary capital-gains treatment — so like the Bonds tab, it flatters the result.