According to data shared by Arora, the Nifty 50’s total return from December 31, 1998, to date stands at 1,922.38%
Gold’s sharp rally this year, comfortably outpacing equity returns, has reignited debate among investors about the best asset class for long-term wealth creation. Helios Capital founder and fund manager Samir Arora weighed in, making a strong case for equities by sharing long-term return data to reinforce the argument that stocks have historically generated superior wealth over extended periods.
Arora was responding to a post on X by Ansid Capital’s Anurag Singh, which claimed that gold has outperformed Indian equities and even broader markets over the long run. The post cited the impact of currency depreciation and questioned whether systematic investments in gold now make more sense. It noted that the Nifty 50, in US dollar terms, rose from about 1,000 in 1994 to 10,500, implying a CAGR of 7.8%, while gold climbed from $345 to $4,550 over the same period, delivering a higher CAGR of 8.6%.
Countering this view, Arora argued that outcomes vary significantly depending on benchmarking and the time period chosen.
Nifty 50 vs gold vs S&P 500
According to data shared by Arora, the Nifty 50’s total return from December 31, 1998, to date stands at 1,922.38%, translating into a compound annual growth rate (CAGR) of 11.78% in US dollar terms over nearly 27 years. Over the same period, gold delivered a return of 1,472.66%, or 10.74% per annum, also measured in dollar terms.
The comparison becomes even more striking when set against the US equity market. The S&P 500 generated returns of 821.05%, or 8.57% per annum, during this period—significantly underperforming both the Nifty 50 and gold.
Arora also pointed out that when comparing Indian equities with the S&P 500, the more appropriate benchmark is the NSE 500 rather than the Nifty 50. On that basis, Indian equities look even stronger: the NSE 500 has delivered 2,590.1% returns, or 12.96% per annum in dollar terms over the same period.
Importantly, Arora noted that all these figures already factor in the depreciation of the Indian rupee over the years—a key concern often cited by investors when evaluating equity returns from a global perspective.
His conclusion was clear: despite bouts of gold outperformance, Indian equities—particularly when measured over long horizons—continue to set a benchmark that few asset classes can consistently match. While gold has surged nearly 80% this year, the Nifty 50 has gained about 10%, reinforcing that short-term cycles can differ sharply from long-term trends.
FAQs: Nifty 50 vs Gold – Long-Term Wealth Creation
1. What has been the total return of Nifty 50 over the long term?
According to Helios Capital founder Samir Arora, from December 31, 1998, to the present, the Nifty 50’s total return stands at 1,922.38%, translating into a CAGR of 11.78% in US dollar terms over nearly 27 years.
2. How has gold performed compared to Indian equities?
Gold delivered a total return of 1,472.66%, with a CAGR of 10.74% per annum in US dollar terms over the same period. While gold has surged sharply in the short term, equities have historically outperformed over extended periods.
3. How does Nifty 50 compare to the US equity market?
The S&P 500 generated 821.05% total returns or 8.57% per annum over the same period, underperforming both Nifty 50 and gold in dollar terms.
4. What is the best benchmark for Indian equities?
Arora suggests the NSE 500 is a more appropriate benchmark than the Nifty 50 for Indian equities. Using NSE 500, returns are 2,590.1% total, or 12.96% CAGR in dollar terms, highlighting stronger long-term performance.
5. Do these returns account for currency depreciation?
Yes. The figures already factor in Indian rupee depreciation, a critical aspect when comparing Indian equities with global assets like gold or the S&P 500.
6. Why do short-term gold gains not imply long-term superiority?
While gold has outperformed equities in certain short-term periods, equities historically generate higher long-term wealth creation, as demonstrated by multi-decade CAGR comparisons.
7. How does short-term performance differ from long-term trends?
Short-term fluctuations, such as gold surging nearly 80% in a single year, do not reflect the consistent long-term growth of equities. Long-term trends smooth out cyclical spikes and provide a more reliable wealth-building path.
8. What is the key takeaway for investors?
Despite occasional short-term outperformance by gold, Indian equities—especially over long horizons—remain one of the most effective asset classes for wealth creation, delivering superior compounded returns when measured in both rupees and dollars.
9. Should investors choose gold or equities for long-term wealth?
Investors may diversify, but historical data suggests equities are better suited for long-term wealth creation, while gold may serve as a hedge during volatility or economic uncertainty.
10. Does the Nifty 50 always outperform gold?
Not always. Short-term cycles may see gold outperform equities, but over multi-decade periods, Indian equities consistently deliver higher total returns and CAGR.
