Which Investment Asset Class Outperformed in 10 Years? Gold, Equity, Real Estate, or Debt
Gold and silver continue to dominate equity, debt, and real estate in 2025 amid global uncertainty and risk aversion. While expectations of further rate cuts by the US Federal Reserve and a weakening USD are fuelling gold prices, strong industrial demand and tight supply are contributing to the surge in silver prices.
Mid- and small-cap segments underperformed in 2025 due to growth stagnation, elevated valuations, margin pressures, slower demand recovery, profit booking, and shifting investor sentiment. Moreover, these segments have become volatile due to geopolitical tensions.
In the long run, equity mid-caps lead the performance charts, driven by scale efficiencies and their ability to innovate and adapt to market changes. On the other hand, gold has been a long-term diversifier due to its low correlation with equities, safe-haven status, strong demand from global central banks, and buoyant retail demand.
The performance of different asset classes over the past decade provides valuable insights for investors. Gold and silver have shown remarkable resilience, particularly in times of economic uncertainty. However, mid-cap equities, despite their recent underperformance, are projected to outperform in the long term due to their efficiency and adaptability.
Real estate, while traditionally a stable investment, has faced challenges due to market saturation and regulatory changes. Debt instruments, especially short-term ones, have provided stability but lower returns compared to more volatile assets like equities and precious metals.
Investors looking to diversify their portfolios should consider a mix of asset classes. Gold and silver can serve as a hedge against market volatility, while mid-cap equities offer growth potential. Real estate and debt instruments provide stability and regular income, making them essential components of a balanced investment strategy.
Source: Reuters-Refinitiv, NHB and ACE MF. 2025 data is YTD based on 29 September 2025 closing values. Other year returns are calculated between the first and the last trading day closing values. NHB Residex returns based on June values for each year. The latest NHB Residex data is available up to June 2025 quarter. Benchmarks used: Equity (Large cap): Nifty 50, Equity (Midcap): 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.
