If you had invested Rs 1 lakh in Indian equities 20 years back, it could have grown to approx Rs 24 lakh by now. However, the value of the same investment in Gold and Real Estate could have been just around Rs 9.6 lakh and Rs 5.6 lakh respectively in 20 years. The value of Rs 1 lakh invested in the US equities could have been just around Rs 11.3 lakh in 20 years, a calculation based on a report on 20-year returns from these asset classes shows.
Indian equities have outperformed all other asset classes, including Gold, Real Estate, US stocks and Debt, over the long run with 17% returns in 20 years, according to the latest ‘Wealth Conversation Report’ by FundsIndia.
The report says that Indian equities (Nifty 50 TRI) have given 17.2% returns in 20 years, 10.6% in 15 years and 13.3% returns in 10 years. In the last five and three years, Indian equities have given a return of 12.9% and 26.1% respectively.
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Compared to Indian equities, the returns from US equities (S&P 500 TRI in INR) have been just 12.9% in 20 years, 14.8% in 15 years and 16.4% in 10 years. In the last three and five years, the US equities have given a return of 16.2% and 15.7% respectively.
The Indian equities have also outperformed US equities in one year with 12.9% returns compared to just 9.5% from the latter.
Gold Returns
The return from gold from 20 years has been 12%, whereas, in 15 and 10 years, it has been 10.3% and 7.5% respectively. Interestingly, in one year, Gold has outperformed all asset classes with 14.2% returns compared to 12.9% from Indian equities and 9.5% from US equities.
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Real Estate Returns
While property buying remains very popular in India, the real estate returns have been just 9% in 20 years and 6.5% and 4.8% in 15 and 10 years respectively. At 6%, the real estate return in one year has been less than 50% of what investors have earned from Indian equities. In the last 3 and 5 years, the real estate returns have been just 4.8% and 5.2% respectively.
Debt Returns
Debt investment shave given 7.2% returns in 20 years and 7.5% in 15 years. In one year, the average debt return has been 6.5%. In 3 and 5 years, the returns from debt investments have been 5.5% and 6.8% respectively.
The report also shows that the mid-cap and small-cap Indian equities have given 17% to 19% returns in 10 years. In the last three years, the returns from mid and small-caps have been between 33.2% to 42.2%.
Disclaimer: The above content is for information purposes only. Stock and mutual fund investments are subject to market risks. Please consult your financial advisor before investing.
