Looking to gold as a safe haven during times of uncertainty? You might want to rethink that strategy. During the (last) financial crisis, from July to October of 2008, gold fell from $986/oz to $712/oz, a drawdown of nearly -30%.  It’s currently down –13% from the 2012 high, and would fall to around $1250/oz if it mirrored that -30% drop this time around.

We’re not saying that gold can’t be a good investment (we’ve been wrong too many times on that), but it’s worth remembering that it isn’t always a refuge during times of trouble. While the current decline has not been as sharp as the one we saw in 2008 (and there’s always the possibility that it will bounce back), we think this is fairly compelling evidence that gold is not a safety play – it can be as risky as any other commodity.