We like the comparison between the “freely” traded price of gold compared to the Nasdaq Composite index because it really shows the difference between the performance in the two over the years.
Most importantly, gold began trading “freely” at around the same time of the initial trading of the Nasdaq Composite Index. Therefore, there is little in the way of distortion in the data. Below is the daily price of gold versus the Nasdaq Composite.
Keep in mind that the Nasdaq index data excludes the necessary adjustments for any dividends that were paid from companies within the index. This would push the Composite Index significantly higher than what is already shown on the chart.
What is the lesson from the chart above? Gold is for speculative purposes while the Nasdaq Composite is for investment purposes.
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