Equity beats gold, FDs, real estate: How Rs 1 lakh grew across assets in five years
Five years can completely transform an investment portfolio — and the journey of a ₹1 lakh allocation proves it. While equities have outperformed most assets over time, 2025 has seen precious metals take the lead. The shifting hierarchy of returns reveals how markets reward long-term conviction over short-term noise.
- Nov 20, 2025,
- Updated Nov 20, 2025 2:11 PM IST
If an investor had deployed Rs 1,00,000 across different asset classes five years ago, the results today would paint a compelling picture of how asset choices — and the power of compounding — shape long-term wealth creation. While equities dominated the earlier part of the decade, the year 2025 has significantly reshuffled the performance rankings, reshaping investor sentiment and asset preferences.
Over the five-year period, equities have emerged as the clear outperformers. An investment of Rs 1 lakh in the Nifty 50 would be worth roughly Rs 1.8 lakh today. The Nifty Next 50 would have compounded faster to around Rs 2.2 lakh, while the Midcap 150 Index would outperform further at Rs 2.7 lakh. Small caps — the biggest beneficiaries of liquidity, earnings growth, and a deep retail investor base — would have generated the strongest returns, swelling to nearly Rs 3.1 lakh.
Commodities, too, delivered meaningful gains. Gold, supported by geopolitical tensions and central bank buying, would have grown to Rs 1.9 lakh, while silver — buoyed by industrial demand from EVs, solar panels, and electronics — would be worth around Rs 2 lakh. A traditional bank fixed deposit, however, would lag substantially, returning just Rs 1.35 lakh, and REITs/InvITs would fare even worse at Rs 1.15–1.25 lakh. On the extreme end of the spectrum, Bitcoin would have skyrocketed to Rs 12–15 lakh, underscoring its high-risk, high-volatility nature.
Gold ruled 2025
But the story flips in 2025. This year, precious metals are outperforming equities, debt, and real estate. Gold and silver remain the strongest performers, fuelled by expectations of US Federal Reserve rate cuts, a weakening dollar, and heightened geopolitical uncertainty. Silver’s industrial demand-supply tightness has amplified its gains. Investors looking for stability have piled into metals, reaffirming their status as defensive assets.
In contrast, mid- and small-cap equities have stumbled in 2025. After two exceptional years, stretched valuations, margin pressures, slower consumption recovery, and risk-off sentiment have triggered heavy profit booking. Global tensions and higher volatility have pushed investors toward safer avenues. The broader market’s underperformance stands in stark contrast to its multi-year leadership.
Still, the long-term picture remains unchanged: equities — especially midcaps — continue to be the most powerful long-term wealth creators. Midcaps benefit from structural tailwinds, agility, and stronger earnings resilience, helping them outperform across cycles. Gold remains a reliable diversifier, offering stability during turbulent periods and maintaining low correlation with equities.
The broader takeaway is simple: every asset compounds, but at different speeds. Sustainable wealth rarely comes from chasing short-lived winners. It emerges from staying invested in long-term engines of compounding that survive multiple cycles.
Is the stock market still the most reliable?
According to FundsIndia’s Wealth Conversations – June 2025 report, long-term data confirms that Indian equities remain the most consistent wealth creators. The Nifty 50 TRI returned 14.6% annually over 20 years, turning ₹1 lakh into ₹15.2 lakh. Gold grew to ₹15.5 lakh, while real estate significantly trailed at ₹4.4 lakh.
Across 10-, 15-, and 20-year horizons, equities outperformed property and often matched or beat gold — despite intermittent volatility. Midcaps delivered extraordinary long-term results, compounding wealth more than 25x in two decades.
Timeframe Indian Equities (Nifty 50 TRI) Gold (INR) Real Estate (NHB Residex) 1 Year 11.1% (1.1x) 43.1% (1.4x) 7.4% (1.1x) 3 Years 15.6% (1.5x) 25.3% (2.0x) 6.9% (1.2x) 5 Years 22.3% (2.7x) 16.4% (2.1x) 5.7% (1.3x) 10 Years 12.7% (3.3x) 14.0% (3.7x) 5.2% (1.7x) 15 Years 12.5% (5.8x) 11.3% (5.0x) 6.4% (2.5x) 20 Years 14.6% (15.2x) 14.7% (15.5x) 7.7% (4.4x)
Source: FundsIndia Wealth Conversations – June 2025 (Data till 31 May 2025)
The message is clear: stay patient, stay invested, and stay disciplined. The market has rewarded long-term investors — and history shows it continues to do so.
Disclaimer: Business Today provides market, bullion, crypto and personal news for informational purposes only and should not be construed as investment advice. All investments are subject to market risks. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
If an investor had deployed Rs 1,00,000 across different asset classes five years ago, the results today would paint a compelling picture of how asset choices — and the power of compounding — shape long-term wealth creation. While equities dominated the earlier part of the decade, the year 2025 has significantly reshuffled the performance rankings, reshaping investor sentiment and asset preferences.
Over the five-year period, equities have emerged as the clear outperformers. An investment of Rs 1 lakh in the Nifty 50 would be worth roughly Rs 1.8 lakh today. The Nifty Next 50 would have compounded faster to around Rs 2.2 lakh, while the Midcap 150 Index would outperform further at Rs 2.7 lakh. Small caps — the biggest beneficiaries of liquidity, earnings growth, and a deep retail investor base — would have generated the strongest returns, swelling to nearly Rs 3.1 lakh.
Commodities, too, delivered meaningful gains. Gold, supported by geopolitical tensions and central bank buying, would have grown to Rs 1.9 lakh, while silver — buoyed by industrial demand from EVs, solar panels, and electronics — would be worth around Rs 2 lakh. A traditional bank fixed deposit, however, would lag substantially, returning just Rs 1.35 lakh, and REITs/InvITs would fare even worse at Rs 1.15–1.25 lakh. On the extreme end of the spectrum, Bitcoin would have skyrocketed to Rs 12–15 lakh, underscoring its high-risk, high-volatility nature.
Gold ruled 2025
But the story flips in 2025. This year, precious metals are outperforming equities, debt, and real estate. Gold and silver remain the strongest performers, fuelled by expectations of US Federal Reserve rate cuts, a weakening dollar, and heightened geopolitical uncertainty. Silver’s industrial demand-supply tightness has amplified its gains. Investors looking for stability have piled into metals, reaffirming their status as defensive assets.
In contrast, mid- and small-cap equities have stumbled in 2025. After two exceptional years, stretched valuations, margin pressures, slower consumption recovery, and risk-off sentiment have triggered heavy profit booking. Global tensions and higher volatility have pushed investors toward safer avenues. The broader market’s underperformance stands in stark contrast to its multi-year leadership.
Still, the long-term picture remains unchanged: equities — especially midcaps — continue to be the most powerful long-term wealth creators. Midcaps benefit from structural tailwinds, agility, and stronger earnings resilience, helping them outperform across cycles. Gold remains a reliable diversifier, offering stability during turbulent periods and maintaining low correlation with equities.
The broader takeaway is simple: every asset compounds, but at different speeds. Sustainable wealth rarely comes from chasing short-lived winners. It emerges from staying invested in long-term engines of compounding that survive multiple cycles.
Is the stock market still the most reliable?
According to FundsIndia’s Wealth Conversations – June 2025 report, long-term data confirms that Indian equities remain the most consistent wealth creators. The Nifty 50 TRI returned 14.6% annually over 20 years, turning ₹1 lakh into ₹15.2 lakh. Gold grew to ₹15.5 lakh, while real estate significantly trailed at ₹4.4 lakh.
Across 10-, 15-, and 20-year horizons, equities outperformed property and often matched or beat gold — despite intermittent volatility. Midcaps delivered extraordinary long-term results, compounding wealth more than 25x in two decades.
Timeframe Indian Equities (Nifty 50 TRI) Gold (INR) Real Estate (NHB Residex) 1 Year 11.1% (1.1x) 43.1% (1.4x) 7.4% (1.1x) 3 Years 15.6% (1.5x) 25.3% (2.0x) 6.9% (1.2x) 5 Years 22.3% (2.7x) 16.4% (2.1x) 5.7% (1.3x) 10 Years 12.7% (3.3x) 14.0% (3.7x) 5.2% (1.7x) 15 Years 12.5% (5.8x) 11.3% (5.0x) 6.4% (2.5x) 20 Years 14.6% (15.2x) 14.7% (15.5x) 7.7% (4.4x)
Source: FundsIndia Wealth Conversations – June 2025 (Data till 31 May 2025)
The message is clear: stay patient, stay invested, and stay disciplined. The market has rewarded long-term investors — and history shows it continues to do so.
Disclaimer: Business Today provides market, bullion, crypto and personal news for informational purposes only and should not be construed as investment advice. All investments are subject to market risks. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.