Equities, gold, or silver — 30-year scorecard reveals which asset really outperformed

Indian equities have been in a prolonged phase of correction and consolidation since October 2024, extending till September 2025, following a combination of domestic and global headwinds. During the same period, gold and silver delivered stellar returns, buoyed by global uncertainty and a weaker rupee.

According to Sriram BKR, Senior Investment Strategist at Geojit Financial Services, while short-term movements may continue to fluctuate, long-term data provides a clearer picture of how these asset classes behave across market cycles. His analysis — spanning 30 years of data from 1995 to September 2025 — uses the Rolling Returns approach to capture the full spectrum of returns, including best and worst periods, free from point-to-point or recency bias.

Equities lead

Indian equities, represented by the Nifty 500 Index, have consistently outperformed gold and silver over medium to long investment horizons. Equities have demonstrated superior average and median compounded annual growth rates (CAGR), particularly beyond five years. The data shows that volatility moderates as the investment horizon lengthens, highlighting the benefits of staying invested through cycles.

While short-term returns can vary sharply, equities tend to deliver higher returns over time, driven by corporate earnings growth, India’s structural economic expansion, and market depth across large, mid, and small-cap segments.

In contrast, silver displayed higher volatility, with large price swings in medium-term periods, while gold showed more stable but moderate returns. Among the three, silver remains the most volatile asset, while gold provides steady inflation-adjusted gains.

Probability of profits

The analysis also assessed the probability of achieving profitable returns and crossing certain hurdle rates such as 7%, 12%, and 15% CAGR. All three asset classes — equities, gold, and silver — have a high probability of delivering positive returns over time. However, equities stand out for their ability to consistently beat the 7% CAGR mark beyond six years, outpacing long-term inflation trends.

For higher thresholds, equities again outperform. The probability of achieving returns above 12% and 15% CAGR is significantly higher for equities compared to gold or silver. This reinforces the case for long-term equity investing, provided one maintains discipline and diversification.

These findings highlight the importance of asset allocation. A balanced portfolio combining equities, gold, and fixed income helps deliver better risk-adjusted returns across market cycles. Diversification is what cushions investors during uncertain times.

Gold’s recent correction

Gold prices have recently corrected sharply after a record-breaking rally. On Friday, spot gold fell nearly 2% to around $4,050 per ounce, down about 7% from its October high of $4,380, as traders turned cautious ahead of the U.S. Consumer Price Index (CPI) data and amid renewed dollar strength.

Despite this short-term pullback, gold remains elevated above historical averages, supported by ongoing geopolitical uncertainties, expectations of interest rate cuts, and strong central bank demand. Most analysts believe the correction is temporary, viewing it as a healthy consolidation after a steep rally earlier this year.

With the Federal Reserve expected to begin rate cuts later in 2025 and global macro risks still simmering, gold continues to hold its place as a hedge against inflation and financial instability.

Long-term outlook

Every asset class has its own cycle — equities generate long-term wealth, gold preserves purchasing power, and silver adds opportunistic exposure. Over a 30-year period, equities have delivered superior performance, while gold and silver have acted as stabilisers during turbulent times.

The key takeaway for investors is clear: asset allocation and time in the market matter far more than timing the market. A disciplined, diversified approach remains the most effective way to capture both growth and stability in the years ahead.