Gold vs Equities vs 10-year G-Sec vs Real Estate: Which Asset Class Delivered the Highest Returns?
An in-depth analysis of the 10-year performance of various investment segments, revealing which asset class has outperformed others and why diversification is crucial.
GoldEquitiesReal EstateAsset AllocationInvestmentReal EstateJul 14, 2025
Mid- and small-cap stocks have faced challenges in 2025 due to an earnings slowdown and weak demand. However, these setbacks are short-term, as these stocks have shown strong performance over the past decade. Gold’s performance underscores the significance of a diversified portfolio. Not only has gold outperformed other asset classes in 2025, but it has also delivered robust annualized returns over the last 10 years.
Equity mid-caps delivered the highest returns over the last decade, followed by gold, significantly outpacing inflation. Inflation, as measured by the Consumer Price Index, averaged 4.73% on a compounded basis from May 2015 to May 2025. Real estate, on the other hand, has only marginally outpaced inflation during the same period.
The performance of various asset classes over the past decade is a testament to the importance of strategic asset allocation. While real estate has seen modest gains, gold and mid-cap equities have been standout performers. This highlights the need for investors to diversify their portfolios to mitigate risks and maximize returns.
Investing in a mix of asset classes can help balance the portfolio and provide more stable returns over the long term. For instance, while real estate has been a traditional favorite for many investors, its performance has been relatively flat compared to other asset classes. Gold, on the other hand, has shown resilience and strong returns, making it a valuable addition to any investment portfolio.
The data from sources like Reuters-Refinitiv, NHB, and ACE MF provide a clear picture of the performance of different asset classes. These insights can help investors make informed decisions and tailor their investment strategies to achieve their financial goals.
In conclusion, while no single investment class reigns supreme, a well-diversified portfolio that includes a mix of equities, gold, and other asset classes can provide the best returns and help investors navigate market fluctuations effectively.
2025 data is YTD based on 8 July 2025 closing values. Other year returns are calculated between the first and the last trading day closing values. NHB Residex returns based on March values for each year. The latest NHB Residex data is available up to March 2025 quarter. 10-year returns in CAGR. Benchmarks used: Equity (Large cap): Nifty 50, Equity (Mid cap): Nifty Midcap 100 Index, Equity (Small cap): Nifty Smallcap 100 Index, Silver: MCX Silver futures, Gold: MCX Gold futures, G-Sec 10-yr: Crisil 10-yr Gilt Index, Debt (Short-term): Crisil 91-day T-Bill Index, Real Estate: NHB Residex.
Frequently Asked Questions
Which asset class has performed the best over the past 10 years?
Equity mid-caps have delivered the highest returns over the last 10 years, followed by gold, significantly outpacing inflation.
How has real estate performed compared to other asset classes?
Real estate has only marginally outpaced inflation over the past 10 years, making it a relatively modest performer compared to other asset classes.
What is the importance of diversification in investment?
Diversification is crucial as it helps balance the portfolio and provides more stable returns over the long term, mitigating risks associated with any single asset class.
How has gold performed in 2025?
Gold has outperformed other asset classes in 2025, delivering robust annualized returns and highlighting its importance in a diversified portfolio.
What is the average inflation rate from May 2015 to May 2025?
The average inflation rate, as measured by the Consumer Price Index, from May 2015 to May 2025 was 4.73% on a compounded basis.
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