Gold, Silver, or Sensex, Which asset class has given better returns in the last five years?

Stock markets, gold, and silver are some of the most preferred investment avenues for Indian investors. Data available from Ace Equity and MCX showed that in 2023, Indian equity benchmark BSE Sensex has surged over 8 per cent year-to-date (YTD). While the broader market indices BSE MidCap and BSE SmallCap have given over 20 per cent and 22 per cent returns, respectively, till August 10. On the other hand, India’s favourite metal gold has jumped 8 per cent while silver has surged over 3 per cent.

Chasing higher returns often leads to riskier investment decisions. However, in a growing economy like India, long-term investments have often yielded good returns for investors. But the biggest dilemma is where to invest, which asset class will provide the highest returns. Here are the details of the five-year performance of equities (large-, mid-, and small-cap), and precious metals gold and silver.

The performance of Indian equities was very volatile in recent years. Five years ago, the large-cap BSE Sensex was trading at 37,869 on August 10, 2018. Then during Covid lows, it declined to 25,981 on March 23, 2020. However, the Sensex has since scaled new highs as it has jumped 74 per cent in the last five years and currently trading at 65,688 as of Aug 10, 2023.

Similarly, BSE MidCap Index gained 88 per cent to 30,469 on August 10, 2023, from 16,211 five years ago. During the Covid pandemic, the BSE MidCap index declined to a five-year low of 9,711 on March 23, 2020. The BSE SmallCap Index has jumped 111 per cent to 35,398 from 16,784 in five years.

The spot gold price has surged 100 per cent in the last five years to Rs 58,947 per 10 grams on August 10, 2023, from Rs 29,486 on August 10, 2018. Gold touched a five-year high of Rs 61,346 on May 4, 2023, and its five-year low was Rs 29,361 recorded in August 2018.

Silver prices have jumped 85 per cent to Rs 70,111 per kilogram from Rs 37,862. The peak price was Rs 76,801 scaled on May 5, 2023, while its five-year low was Rs 34,867 touched on March 17, 2020. So, we can say, on a five years period investment in gold, Silver and Stocks market benchmarks have given almost similar returns, However, volatility was higher in equities.

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