Gold Beats S&P 500 By Widest Margin Since 2011 As Tariff Fears Trigger Rush To Havens

March saw gold post a historic outperformance over U.S. equities, with the bullion on track to beat the S&P 500 by its biggest margin in 13 years. Mounting concerns about trade tariffs, economic growth, and geopolitical instability drove the rotation into haven assets.

Gold prices soared 9% in March, delivering their strongest monthly gain since July 2020, as the metal repeatedly notched fresh all-time highs throughout the month.

In contrast, the S&P 500 tumbled 7.6%, creating a nearly 18-percentage-point performance gap—the widest monthly outperformance for gold over U.S. equities since August 2011.

Chart: Gold Notches Strongest 1-Month Leap Against S&P 500

Investor appetite has mirrored the price action. The SPDR Gold Shares ETF GLD saw inflows of $2.8 billion in March, building on February's $4 billion intake.

Meanwhile, the SPDR S&P 500 ETF SPY witnessed a massive $18 billion in outflows—the heaviest drawdown since January 2024. However, while SPY bled capital, other S&P 500 ETFs like the Vanguard S&P 500 ETF VOO and iShares Core S&P 500 ETF IVV pulled in $6 billion and $21.6 billion, respectively.

"Investors have been adding gold to their portfolios to diversify, having shunned the precious metal in favor of tech stocks for many years," David Morrison, analyst at Trade Nation, said.

Is This The Start Of A Gold Supercycle?

While the rally may seem steep, some believe it's far from over.

Veteran Wall Street investor Ed Yardeni, founder of Yardeni Research, has been bullish on gold since mid-2024 and sees the metal hitting $4,000 by the end of this year and $5,000 in 2026.

Goldman Sachs analyst Daan Struyven presented a scenario where gold could skyrocket even further.

In what the bank terms “tail-risk”—such as rising concerns about the Federal Reserve's political independence or questions around the U.S. dollar's reserve currency status—central banks could increase gold purchases to 110 tonnes per month.

That type of demand pressure could drive up gold to $4,200 or even $4,500.

Q2 Outlook: What Seasonality, Technicals Tell Us

Looking ahead, the seasonality of gold provides a mixed picture.

Paul Ciana, a technical strategist at Bank of America, said that since 1975, gold has tended to trend flat in the second quarter. But over the past 10 years, Q2 has typically delivered a 3% gain from late April to late May, with the strongest week being April 4–11, during which gold has risen 0.9% on average.

Interestingly, an up March has often preceded a down June, with this sequence occurring 71% of the time.

On equities, seasonal trends offer some hope. The S&P 500 Index tends to post gains in the second quarter, averaging 2% into mid-June and 1% by quarter-end. April is often weak, but May brings recovery.

From a technical perspective, Morrison also observed that gold is not as overbought now as it was six weeks ago, helping to ease concerns about a correction.

"So far, profit-taking has led to shallow dips which have been met with fresh buying," he said. "But this only increases the probability that there will be a bigger pullback at some stage."

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