Gold-Stock Market Relationship: Emerging Markets versus Developed Markets

Jalal Seifoddini, Fraydoon Rahnamay Roodposhti, Elahe Kamali


We perform a comparative study on the gold-stock market relationship in U.S. stock market as a developed market and in Iran stock market as an emerging market. By considering appropriate variables for emerging markets and by providing a more proper methodology, we improve earlier studies. According to our findings, the relationship between stock market returns and gold price returns does not follow any specific regimes and that this relationship changes in short and long term returns. It is necessary to mention that in the present research, we did not consider this relationship in major structural changes in the economies and instead considered usual economic circumstances that investors are regularly faced with in their investment decisions.


Gold; Stock Market; Safe Haven; Hedge; Regime Switching

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