Investors who loaded up on gold either in the lead-up to, or in response to, the victory of future president Donald Trump in last week’s election will have no choice but to reassess their judgement today.

It was widely speculated that a Trump victory would send gold prices soaring higher. After all, demand for gold typically rises during times of heightened uncertainty and fear, which is exactly what we saw when it became apparent Trump would claim victory. Gold prices experienced a sudden spike, climbing as high as US$1,334 an ounce.

Since then, however, the spot gold price has fallen, a lot. In fact, it fell another 2.5% during the last session alone and is now fetching US$1,227 an ounce – down 8% from its recent peak.

Shares of the gold miners themselves have been whacked as a result, with the trend continuing during today’s session. EVOLUTION FPO (ASX: EVN) has tanked 5.9%, Beadell Resources Ltd (ASX: BDR) has fallen 8.2% while Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) have shed 5.1% and 6%, respectively.

Each of those shares have fallen between 15.9% and 21.1% since their peaks on 9 November. Worse yet, the gold price could continue to dive from here which could see them fall even further.

To be clear, the broader economic impact of Trump’s campaign remains uncertain, as do the policies that will ultimately be enacted under his administration.

The Wall Street Journal quoted Megan Greene, chief economist at Manulife Asset Management, as saying: “Anyone who tells you they absolutely know what will happen under a Trump presidency is probably lying.”

While that uncertainty should arguably boost the gold price, investors appear more receptive to the now increased likelihood of higher interest rates in the United States, together with the prospect for significant economic growth in the short-term. Both of those scenarios would likely curb demand for gold bullion given the availability of other assets offering potentially higher returns.

Should you buy gold?

We highlighted last week that legendary investor Stanley Druckenmiller had sold all his gold holdings on the night of the US election. He stated that all the reasons he owned gold in recent years appeared to be ending, with the prospect for higher economic growth and interest rates.

Although there are certainly risks associated with Donald Trump’s proposed strategies for achieving long-term growth, if they do work – even in the short-term – that could see gold prices fall further from their current level. Gold prices are inherently difficult to predict, of course, but that is just one of the reasons why an investment in gold today could be a bad idea.

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Motley Fool contributor Ryan Newman has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.