Indian Pulse Media

In the last five years, despite the global economic crisis, gold has outperformed the Sensex, experts say

<p>Investors often choose gold over stocks during economically challenging times. The coronavirus epidemic and the Ukraine-Russia conflict were the primary causes of the recent years’ significant ups and downs. According to experts, the Sensex has been volatile over the last five years, which has kept its returns lower than the safe-haven metal and increased the price of gold.</p>
<p>Since July 2018 and over the previous five years, gold has increased by 99%. The Sensex, on the other hand, has increased by 77% throughout that time.<img decoding=”async” class=”alignnone wp-image-89412″ src=”” alt=”” width=”1128″ height=”845″ srcset=” 259w,×112.jpg 150w” sizes=”(max-width: 1128px) 100vw, 1128px” /></p>
<p>The price of 24 karat gold per 10 grams was Rs 30,850 on July 30, 2018, but as of July 21, 2023, it has increased by approximately 99 percent to Rs 61,400. The Sensex was at a level of 37,550 on July 30, 2018, and it is now at a level of roughly 61,800, up almost 77%.</p>
<p>Vice-president and research analyst at LKP Securities Jateen Trivedi stated that “Gold in the past five years has benefited from many global uncertainties, including the US-China trade war (running from 2019), the pandemic in 2020, the liquidity issue in 2021, the Russia-Ukraine war, and the high inflation globally in 2022.”</p>
<p>The Sensex has reached 66,500 from about 37,000 levels, while gold prices in the domestic market reached above Rs 60,000 from Rs 30,000 in July 2018, the speaker said, as the protection of money remained over the time.</p>
<p>In the last five years, gold prices in India have increased more than those in other countries owing to a depreciating Indian rupee, according to Hareesh V, head (commodities) at Geojit Financial Services. The rupee fell 31% from 63 to 82 per dollar in 2017 to the current rate.</p>
<p>While the price of gold has increased by 99 percent in India during 2018, it only increased by 60 percent on the worldwide market, or about from $1,230 per ounce to $1,960 per ounce.</p>
<p>Sensex Vs. Gold: What Investors Need to Know</p>
<p>Hareesh said that in order for investors to comprehend the dynamics of the market, they must look at a longer-term trend. He noted that whereas gold has only increased by 140% since 2012, the Sensex has increased by a staggering 320%.</p>
<p>“In normal times, the Sensex has outperformed gold in terms of returns. But during the last five years, there have been a lot of global concerns, both economic and political, which have driven up the price of gold, according to Hareesh, who spoke to</p>
<p>The elements that led to gold purchasing, according to him, were weak economic forecasts, supply chain instability during the pandemic, geopolitical concerns, central banks buying gold to increase reserves, and currency uncertainty.</p>
<p>The Sensex has generally provided positive returns over a longer period of time since 2012, with the exception of two instances: a slight fall in 2015-March 2016 and a significant drop during the epidemic. However, throughout the bull market between 2011 and 2018, gold was range-bound between Rs 24,500 and Rs 33,000, after which unpredictability led to a breakout, according to Hareesh.</p>
<p>The US debt is at its highest levels, which going forward can be another trigger for uncertainty to benefit gold and keep the Sensex volatile, according to Jateen Trivedi of LKP Securities, who advised investors to maintain a balanced portfolio with a good allocation of at least 25–30% in gold.</p>
<p>The market is still unpredictable, according to Hareesh. Economic statistics reveal China’s deterioration. Prices for gold are favored. Investors might think about retaining around 20% of their wealth in gold.</p>
<p>The BSE Sensex is now at 67,000, while the NSE Nifty is below the level of 19,800. The current cost of 10 grams of 24-carat gold is Rs 60,590.</p>
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