Gold bulls wagering the bullion rally has more room to run may have history on their side with the arrival of a new U.S. president.
A look at recent presidential transitions supports optimism among traders over the metal’s prospects. Gold has averaged gains of almost 15% in years marking the inauguration of a new president since the 1970s, advancing in five of those seven years. In contrast, the S&P 500 index of equities declined in four of those years for an average loss over the period of 0.9%.
From Presidents Gerald Ford to Barack Obama, bullion has often served as a haven in times of political flux. The metal has climbed almost 5% this year as questions over the possible economic impact of Donald Trump’s policies add to investor angst over Brexit and mounting trade frictions. Bulls reason that gold will extend its gain as scant details of