Gold vs equity vs property: We Indians love gold, believe in property and are gradually getting attracted towards the stock market as well. But which of these increased investors’ wealth the most in the last 10 years? The answer is not that simple. The performance of each asset depends on time, risk appetite and your personal goals.
How was the condition of gold?
Gold has always been popular in India. This has helped provide stability in difficult times, especially during the pandemic and global market volatility. On average, gold has given around 8-9% annual returns in the last 10 years.
This is certainly not much, but continues to give an edge. The biggest advantage is that gold acts as a security when the market falls.
stock market situation
The stock market, whether through stocks or mutual funds, has performed better in the long run. Despite market downturns and corrections, Indian equity indices have delivered an average of 12-15% annual returns in the last 10 years.
Holding good growth stocks for a long time and compounding gives good returns to investors. Provided that you do not panic and sell shares in recession nor stop SIP.
How much did the property give?
Real estate has traditionally been the choice of Indian families. Its performance was quite mixed. After the mid-2010s, property prices grew slowly due to changes in regulations and low demand. The average annual growth in many cities has been 6-9%, which is lower than the stock market but higher than inflation.
The property can also be put to good use. You can live in it, give it on rent or pass it on to your heir. However, there is an issue of liquidity i.e. you cannot arrange money by selling it immediately.
Investment of Rs 10 lakh in all three
If you had invested Rs 10 lakh in 2014, today you would have had gold worth around Rs 21 lakh. At the same time, the share market would have made around Rs 40 lakh of Rs 10 lakh, depending on the fund or stock. At the same time, the value of the property would have been between Rs 18-22 lakh.
Statistics show that the stock market is at the forefront in terms of returns, but every asset has its own role. Gold provides security, shares provide appreciation, and property provides stability and ease of living.
What should investors do?
Experts believe that investors should adopt the strategy of diversification. This means that instead of investing all the money in one asset, invest a little bit in everything.
The synergy of gold, shares and property ensures that when one asset underperforms, the others will keep your portfolio balanced.
Should I sell gold or property and invest in the share market?
Not necessary. Gold and property play different roles in your financial plan. Shares increase wealth rapidly, but gold provides security and property stability. Balance is necessary.
Which asset is best for retirement planning?
The stock market is best suited for long term growth. But gold and property also add security and stability.
Are past returns a guarantee for the future?
No. Gold, shares and property all move in cycles. What worked in the past is not guaranteed to work the same in the future. The decision should depend on your goals, time and risk appetite.
Also read: Plot Loan: Want to buy only land, not house? Know how and on what conditions the loan will be available