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Every Diwali, Indian households face the same investment dilemma: should one buy gold, a symbol of wealth and security, or put money into stocks, which promise long-term growth and prosperity? A closer look at data from the past 15 years provides some surprising insights into how these two asset classes have fared and what investors should consider this festive season.
Gold has historically been seen as a safe-haven asset, and the numbers back that up. If an investor had consistently invested Rs 10,000 every Diwali since 2010, the total contribution of Rs 1.5 lakh would today be worth around Rs 4.47 lakh. That’s a growth of about 4.5x over 15 years.
In comparison, the same investment in the Nifty 50 index would have grown to Rs 3.72 lakh, or about 3.7x. Clearly, gold has had the upper hand over this period, outperforming equities by a noticeable margin.
Zooming into a shorter period shows that gold has maintained its edge:
Five Years: Gold has delivered a 16.1% CAGR, while the Nifty clocked in at 13.8% CAGR.
Ten Years: Gold’s CAGR stood at 15.1%, compared with Nifty’s 12.3%.
This consistency reflects gold’s ability to surge during periods of global uncertainty, often when equities falter.
A close look at how a one-time Diwali investment performed in different years highlights the contrast even more clearly.
If an investor had put Rs 10,000 into the Nifty 50 in 2010, the investment would now be worth around Rs 39,180, whereas the same amount in gold would have grown to about Rs 54,200. Similarly, an investment made in 2015 would have grown to Rs 31,630 in Nifty compared with Rs 41,340 in gold.
Even more recently, if one had invested in 2020, the Nifty investment would now be valued at Rs 19,370, while gold would be slightly ahead at Rs 20,980.
In each of these cases, gold has managed to hold the upper hand, especially during periods when equity markets faced headwinds.
Gold’s outperformance stems from a mix of global and domestic factors:
Safe-Haven Appeal: Whenever inflation, geopolitical risks, or financial instability rise, investors rush to gold.
Cultural Significance: In India, buying gold during Diwali and Dhanteras is considered auspicious, which further boosts seasonal demand.
Central Bank Buying: Around the world, central banks have been increasing gold reserves, lending long-term support to prices.
This combination of economic and cultural drivers explains why gold often shines brightest during times of uncertainty.
Despite gold’s recent dominance, equities should not be underestimated. Over the long run, the stock market has consistently created wealth for patient investors. The Nifty 50 reflects India’s corporate growth, earnings expansion, and the broader economic story.
Key advantages of equities include:
Compounding Power: Systematic investments (like SIPs) can multiply wealth over decades.
Inflation-Beating Returns: Equities have historically outpaced inflation, unlike gold, which primarily acts as a store of value.
Growth Potential: India’s structural growth in sectors such as banking, IT, energy, and consumer goods ensures that equities remain attractive for long-term portfolios.
While equities may lag gold in certain periods, their wealth-creation capacity is unmatched when viewed over multiple decades.
The right strategy depends on individual goals and risk appetite:
For Stability: Those seeking safety or lower risk may prefer allocating more to gold, particularly given its cultural importance during Diwali.
For Growth: Investors focused on long-term wealth creation should continue to prioritize equities.
Balanced Approach: A mix of both is often ideal. Allocating a smaller share to gold helps hedge against volatility, while equities drive compounding and growth.
Over the past 15 years, gold has clearly outperformed equities, with an annual Diwali investment of Rs 1.5 lakh growing into Rs 4.47 lakh, compared with Rs 3.72 lakh for the Nifty.
Even over shorter horizons of five and ten years, gold has maintained its lead, supported by global uncertainties and its role as a safe-haven asset.
That said, equities remain indispensable for long-term wealth creation. They offer higher growth potential, the benefits of compounding, and the ability to outpace inflation, advantages that gold alone cannot deliver.
This festive season, the smartest strategy is a balanced one: allocate a portion of savings to gold for security and tradition, while directing the rest toward equities for growth. This way, investors can enjoy both protection in volatile times and sustained prosperity in the long run.
Also Read: Top Performing Gold ETFs of 2025: HDFC, ICICI Prudential & More
The gold versus stocks debate is not just about numbers; it also reflects tradition, sentiment, and financial planning. While gold continues to shine with strong returns and cultural appeal, equities remain indispensable for compounding wealth over time.
This Diwali, investors don’t need to choose between them. Instead, a thoughtful balance can ensure both prosperity and protection, honoring tradition while building a brighter financial future.
1. Has gold outperformed stocks in the last 15 years?
Yes. Gold grew 4.5x compared to 3.7x for Nifty, making it the stronger performer.
2. Which performed better over 5 and 10 years?
Gold maintained an edge with higher CAGR 16.1% (5 years) and 15.1% (10 years) vs Nifty’s 13.8% and 12.3%.
3. Why does gold perform well during uncertainty?
Gold acts as a safe haven, attracting investors during inflation, geopolitical risks, and financial instability.
4. Should I invest only in gold this Diwali?
Not necessarily. While gold is safer, equities remain vital for long-term wealth creation and beating inflation.
5. What is the best investment strategy this festive season?
A balanced portfolio: allocate some savings to gold for stability and the rest to equities for growth.
