Gold prices reached record highs in early 2026 before shortly retreating, according to Vanguard’s analysis, “Alternatives in a Portfolio: Think Role, Risk and Realism.” Assets such as gold, silver and physical commodities differ from traditional investments in that income or cash flows are not generated, but many are gaining traction among retirees.
Interest in physical assets has grown alongside retirees’ desire for inflation protection, according to American Alternative Assets LLC, a precious metals investment firm that released a 2026 guide to including such investments in individual retirement accounts.
“Retirees aren’t asking us if they should diversify into hard assets—they’re asking how to do it properly,” said Shanon Davis, American Alternative Assets’ CEO, in a statement.
A precious metals IRA holds actual bullion—coins and bars stored in an IRS-approved depository on behalf of the participant—and can include gold, silver, platinum and palladium. According to the guide, precious metal IRAs can serve as a hedge against inflation and against currency policy decisions, as well as a portfolio diversification tool.
Advisers, however, may need to help clients balance expectations, as diversification benefits from gold are not guaranteed and may falter during periods of market stress, according to Vanguard’s analysis. Gold is typically expected to behave defensively during periods of inflation, currency weakness or geopolitical stress, but Vanguard’s report stated it does not always do so.
“Treating gold, or any alternative, as dependable portfolio insurance embeds an expectation that is inconsistent with how diversification actually works,” stated Roger Aliaga‑Díaz, Vanguard’s global head of portfolio construction, and John Ameriks, Vanguard’s head of quantitative and strategic equity, in a joint statement. “Real-world diversifiers can improve outcomes and pay off in a manner consistent with their long-term history. But they do not eliminate uncertainty, and history shows they can still fail during periods of stress.”
Ongoing congressional consideration of stablecoin legislation is contributing to broader interest in alternative assets, including physical precious metals held within IRAs.
However, even small allocations can quickly dominate portfolio risk, according to Vanguard. Its analysis found that an 11.5% exposure in gold can result in a 15.8% asset volatility, and a 9.3% exposure to silver can result in a 29.6% asset volatility, highlighting a need for clear allocation guardrails.
“For investors who choose to include them, recent experience in the gold market reinforces a timeless lesson,” stated Aliaga‑Díaz and Ameriks in their report. “Portfolios succeed not because every asset performs consistently, but because uncertainty is acknowledged, risk is managed deliberately and allocation decisions remain grounded when markets test conviction.”