Dow-to-Gold Ratio Hits 12-Year High Amid Persistent Inflation

The Dow-to-Gold ratio measures how many ounces of gold it takes to buy one share of the Dow Jones Industrial Average. In 2011, it took six ounces of gold to buy the Dow, but now it takes twelve ounces.

This means the Dow has become twice as valuable relative to gold since then.

The ratio doubled due to a significant outperformance of the stock market over gold during this time period.

Looking at the price comparison between 2011 and today, we see that the Dow Jones Industrial Average has risen from around $11,500 to $51,371, while gold has increased from about $1,900 to $4,257.

This represents an absolute return of 346% for the Dow and 124% for gold since 2011.