Price development of gold and S&P 500 index as a determinant of investment behavior: A comparative analysis

Research background: While gold is traditionally viewed as a safe haven and a store of value, especially in times of economic uncertainty, the S&P 500 index reflects broader market sentiment and offers higher return potential over the long term—albeit with greater volatility. Purpose of the article: The aim of this study is to provide a comparative analysis of the price development of gold and the S&P 500 index across different time periods and economic conditions, in order to offer recommendations for optimizing investment decisions and enhancing portfolio diversification. Methods: The theoretical framework is based on investment decision-making from the perspective of risk, return, and individual investor preferences. The empirical part analyses historical data on the price development of gold and the S&P 500 index from February 2015 to February 2025, with the Pearson correlation coefficient indicating a moderately strong and statistically significant relationship between the two assets. To support investment decisionmaking, the multi-criteria decision-making method TOPSIS was applied, enabling the evaluation and ranking of various investment instruments according to the preferences of conservative and risk-oriented investors. Findings & Value added: The findings highlight significant differences between the analysed assets in terms of volatility, return potential, and behaviour during different phases of the economic cycle. Gold shows the characteristics of a safe-haven asset, while the S&P 500 index appears more attractive for investors with a longer time horizon and higher risk tolerance. The added value of the study lies in its integration of quantitative analysis with behavioural aspects of investing and the implementation of multi-criteria decision-making as a tool for personalized investment recommendations. The study also opens space for future research focused on dynamic correlation models and the inclusion of other asset classes and investor profiles.