'Gold gave zero returns for 8 years': CA warns investors chasing the ₹1 lakh hype

As gold flirts with the ₹1 lakh mark per 10 grams, Chartered Accountant Nitesh Buddhadev is urging investors to take a longer view — one that stretches beyond the current high and examines what gold has really delivered over time.

“Gold gave almost zero returns for 8 years,” he writes in a data-backed LinkedIn post aimed at tempering short-term excitement with long-term context. 

Between 2012 and 2019, the price of gold moved marginally — from ₹31,050 to ₹35,220 per 10 grams. That’s not a gain worth chasing, especially when viewed through the lens of annualised returns.

And this wasn’t an isolated stretch. “Look at another decade of dull performance: 1992 to 2002 — Gold moved from ₹4,334 to ₹4,990 in 10 YEARS — that’s less than 1.5% CAGR again!” he adds.

The reason gold has doubled since 2020, he explains, lies in the very nature of such assets. “Because it had barely moved for 8 years before that,” he says. The spike was triggered by a combination of macro shocks — COVID-19, war, inflation fears, and central bank buying — all converging to push prices sharply upward. “Every sharp rally often comes after a lull,” he notes.

That context is what investors need to keep in mind. “Am I saying don’t invest in Gold? Absolutely not,” Buddhadev clarifies. 

“It’s a great asset for diversification. It’s a hedge in uncertain times. But it’s not a consistent growth engine like equity. And it’s definitely not risk-free.”

His message: treat gold with realism, not reverence.

“Don’t get influenced by recency bias. Even Gold is volatile. Have realistic return expectations. It too goes through dull decades. Limit your allocation to say 5% to 12%, with a long-term view.”

Meanwhile, despite a 25% price surge this year, India’s gold demand fell 15% by volume in Q1 2025, according to the World Gold Council. The total value of purchases rose 22% to ₹94,030 crore — suggesting that while investor sentiment remains active, affordability may already be under strain.