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Gold Investing Basics

No earnings, no dividend, no yield. So why has gold held value for thousands of years, and what actually moves the price from one week to the next?

289t Central bank buying, Q2 2026
+62% Year on year change
0% Income gold pays you
Explore the Guide

Gold as an Investment: How It Works and What Moves the Price

Gold has no earnings, pays no dividend and produces nothing. Its price comes almost entirely from what other people are willing to pay for it, which sounds like a weakness until you notice it has held that value for several thousand years across every currency and government that has come and gone in the meantime.

Molten gold pouring from a graphite crucible into an ingot mould at a refinery
Molten gold poured into an ingot mould. Refining changes the shape and the purity, never the element itself.

This section covers the fundamentals: why gold holds value at all, what actually moves the price week to week, how it has behaved against inflation and against shares, how much of a portfolio people typically put into it, and the risks that gold marketing tends to leave out.

What Vanhess does and does not do

Vanhess is a jewellery shop in Coquitlam, British Columbia. We sell solid gold jewellery. We do not sell bullion, bars, coins or wafers, we do not buy or broker investments, and we are not financial advisors, tax advisors or a bullion dealer. Everything on this page is general information to help you understand how gold is priced and valued. It is not financial, investment or tax advice. Speak to a licensed advisor or an accountant before making a decision about your money.

The one property that explains most of it

Gold is an element. It does not rust, tarnish, corrode or decay, and it cannot be manufactured. Almost all the gold ever mined still exists, which means supply grows slowly and predictably rather than being created at will. That is the whole basis of the argument for holding it, and everything else is commentary on top.

It also explains a detail that surprises people: recycled gold is chemically identical to newly mined gold. Melt down a Victorian brooch and the metal that comes out is the same element at the same purity as a freshly refined bar.

What this section covers

Each guide below answers one question properly rather than skimming all of them.

Frequently Asked Questions

Does gold always go up?

No, and anyone who tells you otherwise is selling something. Gold has had long periods of flat or falling prices, including a multi-year decline after its 1980 peak and another after 2011. It is held for the way it behaves relative to other assets over long periods, not because it rises every year.

Does gold pay any income?

No. Gold produces no dividend, interest or rent. The only return is the change in its price, and holding physical gold has ongoing costs for storage and insurance, so a flat gold price actually means a small loss over time.

Is gold a hedge against inflation?

Over very long periods gold has broadly kept pace with the cost of living, but it is an unreliable year-to-year inflation hedge. There have been years of high inflation when gold fell. Treat it as a long-horizon store of value rather than a short-term inflation trade.

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