Correlation between Stocks and Gold?

[Fradika]

I'm trying to understand overall trends. When stocks go up, does gold go down, and vice versa? Data would be appreciated. Thanks,

[stuper1]

From what I've generally read, gold and stocks are pretty much uncorrelated when analyzed statistically.  And that's a good thing.  Over the long term, they both seem to go up, although some people will say that gold doesn't go up in real terms after inflation.  I'm not so sure about that.  Anyway, since they are relatively uncorrelated, they make great assets to own together in a diversified portfolio, along with say some long-term bonds and some short-term bonds.

[Kshartle]

Since they're both priced in dollars...they will go up generally speaking when the dollar weakens and they will trend down when the dollar is very strong. That makes them appear to be correlated sometimes, just like pretty much everything else other than bonds. They really aren't correlated though. Stocks represent the future profit of business. Basically a booming economy produces greater profits and profit growth and will drive up stock prices, thus stocks are for prosperity. Gold is a safe haven for when times are tough and scary and the economy is struggling. They are really negatively correlated but since we keep going through these monetary cycles those spurts of high correlation due to the fluctuation of the dollar disguise their relationship.