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News18
24-07-2025
- Business
- News18
Rs 1 Lakh Invested In Equity, Gold, Real Estate In 2005: Which Gave Most Returns In 20 Years?
Last Updated: But what matters in the investment is the returns. Thus, it's better to look at the historical returns for these asset classes in the long-run, over 10 or 20 years. Equity Vs Gold Vs Real Estate: The equity market is a long-term game as propounded by several renowned investors. This isn't just an old rhetoric to hide the embedded volatility that could oscillate an investor's heartbeat by daily losses and gains. Even data accentuates this old-age wisdom that equity market outperforms other assets including gold, real estate and debt in the long term. There are several avenues of investment for Indian investors, be it equity, gold, real estate, and several more. Mainly, these are major financial instruments that are considered for wealth-building. However, options lead to confusion as where to go for the investment. This is known as 'Choice Paradox', the more options you have, the more confused you will become. Where should an investor go among Equity, Gold, and Real Estate? There's no specific answer. Each asset and investment instrument has pros and cons. The investors' conviction and risk-factor that play an important role in the decision. But what matters is the returns. The purpose of investment in assets is to generate as much return as possible. Thus, it's better to look at the historical returns for these asset classes in the long-run, over 10 or 20 years. Of course, past return won't guarantee the same future return. This investors must keep in mind while making an investment decision. Indian equities have outperformed other major asset classes over the long term, generating compounded annual returns of 14.4% over the past 20 years, according to data as of June 30, 2025, compiled by FundsIndia. This translates into a 14.7x multiplication of investors' money—highlighting the consistent wealth-building potential of long-term investments in equities. The Nifty 50 Total Returns Index (TRI) topped the long-term chart, delivering robust returns over two decades, outpacing asset classes such as real estate, debt, and even gold. Interestingly, gold also performed strongly over the 20-year horizon, matching Indian equities with a 14.4% return and a 14.8x multiplier. However, its 15-year CAGR was lower at 11.1% versus Nifty 50's 12.4%. Real estate and debt lagged significantly in long-term performance. Real estate investments returned just 7.7% CAGR over 20 years, growing 4.4 times in value. Debt assets performed similarly, with a 7.6% return and a 4.3x multiplier. In the short term (1–3 years), gold remained highly volatile, showing a 45% return in 1 year and 25.2% in 3 years, while Indian and US equities experienced relatively steady growth. How Much Rs 1 Lakh Invested In These Assets In 2005 Would Be Today? If you had invested Rs 1 lakh in Indian equities (Nifty 50 TRI) 20 years ago, your money would have grown nearly 15 times to become around Rs 14.7 lakh today. A Rs 5 lakh investment would have become approximately Rs 73.5 lakh, and Rs 10 lakh would have turned into a whopping Rs 1.47 crore. Gold has also been a solid performer. Over 20 years, it multiplied investments by 14.8 times. This means Rs 1 lakh invested in gold would now be worth Rs 14.8 lakh, while Rs 5 lakh would have grown to Rs 74 lakh, and Rs 10 lakh to Rs 1.48 crore. On the other hand, real estate delivered more modest growth—multiplying money by 4.4 times. So, Rs 1 lakh would have become Rs 4.4 lakh, Rs 5 lakh would be Rs 22 lakh, and Rs 10 lakh would have grown to Rs 44 lakh. tags : equity Gold real estate view comments Location : New Delhi, India, India First Published: July 24, 2025, 14:18 IST News business » savings-and-investments Rs 1 Lakh Invested In Equity, Gold, Real Estate In 2005: Which Gave Most Returns In 20 Years? Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
News18
22-07-2025
- Business
- News18
Rs 10 Lakh To Rs 18 Crore In 30 Years: This MF Doubled Money Every 7 Years
Last Updated: A new analysis by FundsIndia shows that a lumpsum investment in the HDFC Flexi Cap Fund has historically multiplied more than 2 times over a 7-year period. Multibagger Mutual Fund: Mutual fund is a good financial instrument that allows an investor to invest a particular sum without using too much brain. MF comes in various sizes and shapes, catering to different customers. The sole decision lies with investors on which mutual fund they choose. One such mutual fund HDFC Flexi Cap Fund has become a gold mine for investors. Flexi-cap funds are a type of open-ended equity mutual fund that offers fund managers the flexibility to invest across all market capitalizations – large-cap, mid-cap, and small-cap stocks – without any restrictions. A new analysis by FundsIndia shows that a lumpsum investment in the HDFC Flexi Cap Fund has historically multiplied more than 2 times over a 7-year period, making it one of the most consistent long-term performers in the Indian mutual fund space. The fund was launched in 1995. Even the average returns are impressive. The fund has, on average, doubled money in 7 years. Over 20 years, average returns have ranged around 25x to 45x, turning Rs 10 lakh into Rs 2.5 to Rs 4.5 crore. However, not all periods have delivered equally. Investments made just before market crashes, like in 2008, saw much lower short-term returns. But holding for 10 years or more has historically reduced that risk significantly. How Much A Lumpsum Investment Of Rs 5 Lakh and Rs 10 Lakh Would Be In 10, 20, and 30 Years? If someone had invested Rs 5 lakh in this fund and stayed invested for 10 years, their investment could have grown up to Rs 48 lakh, based on historical maximum returns. With a 20-year holding, that same Rs 5 lakh would have grown to nearly Rs 2.5 crore, and over 30 years, it could have touched an astonishing Rs 9.3 crore. Now imagine investing Rs 10 lakh instead. Over 10 years, the amount could have become Rs 96 lakh. If held for 20 years, the investment would be worth more than Rs 5 crore, and over 30 years, it could have multiplied to over Rs 18 crore. view comments First Published: July 22, 2025, 14:59 IST Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Mint
29-04-2025
- Business
- Mint
Why Arun Kumar of FundsIndia backs investment styles others are avoiding
Arun Kumar, vice-president and head of research at FundsIndia, has a distinct style of investing in mutual funds, one that leans heavily on value investing. Around 55% of his portfolio is parked in funds that follow a value style of investing. In an interaction with Mint for the Guru Portfolio series, Kumar shared his contrarian approach when it comes to picking mutual funds for his portfolio. 'I like it when certain investment styles or investment approaches are not doing well," he says. I have always been equity-heavy. Currently, my portfolio is 90% equity, and the remaining 10% is in debt and arbitrage funds. I'm comfortable with this because my wife and I have active income and contribute 10-15% of the portfolio value each year. Even during bear markets, we contribute to the portfolio. However, as our portfolio grows over time, our savings might not catch up with it. There will be a time when our portfolios will become so big that we'll not be able to add meaningfully (less than 5%) to our portfolios. At that time, I will shift to a more conservative portfolio and keep it 70% equity, 15% gold, and 15% debt and debt-like investments. A chunk of my portfolio, 55%, is in four funds. I have a natural bias towards value investing as a style and have invested in funds that fund managers manage with a value bias. It's split across Sankaran Naren's ICICI India Opportunities, Rajeev Thakkar's PPFAS FlexiCap , Kenneth Andrade's Old Bridge focused equity fund, and HDFC FlexiCap, which Prashant Jain earlier managed. Another 15% of our portfolio is to make slightly concentrated bets. I am bullish on banking as a sector and put all this portion in one banking stock. I feel that the NPA cycle has been cleaned up, and the credit growth cycle is about to start. Banks also have a strong balance sheet because they had over-prepared for covid, but the impact wasn't as bad as we thought. Banking is a good sector going through a bad time with decent valuations, and I'm hoping for a reversal in the future. The other 15% is spread across the globe. I had taken a bet in Chinese tech through Mirae's Hang Seng Tech ETF two years ago. It didn't do well for some time, but started playing out in the last one year. I also had an SIP in a Nasdaq fund. When the markets crashed in 2022, I built up my position in a FAANG [Meta (formerly Facebook), Amazon, Apple, Netflix, and Alphabet (formerly Google)] stock, which was part of that index. That stock has gone up 4x, leading to slightly skewed exposure. The remaining 5% is allocated to mid- and small-cap funds. I did not have any allocation to mid- and small-cap before and missed the whole rally. The only exposure I had was indirectly through flexi-cap funds that had some exposure to such companies. I was already too much into equities and didn't want to get too aggressive. Over time, the plan is to gradually start building the small and mid-cap exposure. Also Read: Why Marcellus' Saurabh Mukherjea has 40% global weight I had missed the whole small and mid-cap rally. I did not have any funds from that category, and the only allocation I had was through my flexi cap. Learning from this experience, I have now put in place a framework to play small caps. SIP can also be a simple way to build exposure. I like it when certain investment styles or investment approaches are not doing well. Lately, momentum-oriented funds have not been doing great, and I am looking at it, although I haven't made up my mind. We also didn't have many options before, but now we have plenty of them. Quality is another style that has dramatically underperformed in the last four years, and I see some early signs of a turnaround. I am now looking at quality schemes and will slowly build up exposure there. That is what I'll focus on for the next few months. Everyone wants high-quality companies with high ROCE (return on capital employed), low debt, consistent earnings, high earnings growth potential, and good management at decent valuations. It's very difficult to get all of these in one stock. So, quality fund managers usually end up compromising on the valuations front. This overpaying has come to bite them in the past four years. When the markets rebounded, it was a broad-based recovery where all stocks, regardless of their quality, were growing their earnings at a rapid pace, and so there was no need to pay an exorbitant price for quality. But when the market starts going through a tough phase, and only a few good quality companies are winning, that's when quality starts performing. While it's tough to time styles, the recent underperformance and the moderating growth environment with a lot of uncertainty thrown in augurs well for quality. Overall, it seems like a good place for quality to start working again. When the tide turns is anybody's guess, but at least it's crucial to remain consistent with our process. Also Read: Look who's making a comeback: Quality vs value investing I like UTI Flexi cap for sticking to its quality investment style even when it has fallen out of favour. I have hardly sold any of my funds since I started seriously investing in 2015. I have redeemed a few small allocations here and there to clean my portfolio. However, I've kept all my core holdings. I buy funds mostly by looking at the fund manager. As long as the same fund manager runs the fund, I don't mind even if it's underperforming. HDFC Flexi cap is one scheme that I bought due to Prashant Jain, but he left HDFC in 2022. However, I continued holding that scheme because the current manager, Roshi Jain, manages the fund reasonably well. As a thumb rule, I would contemplate selling when the fund manager changes or there is a significant change or dilution from the stated investment approach. Another aspect is on the performance front. If the returns deteriorate and I am not able to understand the reason behind it, then that can be an issue. But let's say a fund manager who follows a quality style is underperforming, and all others with the same style and index are also struggling; then it's okay. In this case, underperformance is not an issue. In fact, I bought most of my schemes when the fund manager was underperforming. In contrast, if you're following a certain style and are performing poorly when others following the same style are doing well, then that's a sign to sell out. Also Read: Sachet-sized mutual funds can still be difficult for the house help as an investment option Keeping it simple works: Fewer decisions, fewer funds, and more patience. Backing good fund managers during tough phases: Buying into skilled fund managers who are going through challenging times—but sticking to their proven approach—often pays off. The magic of compounding also becomes truly meaningful once the portfolio reaches a reasonable size. It's also important to track incremental savings. It helps in two ways: identifying where you can get a bigger bang for your buck and deciding how much time and effort to allocate between increasing savings versus chasing higher returns. It also brings the focus back to what truly matters: growing the overall portfolio through a combination of steady savings and returns. Lastly, behaviour beats brilliance: Sticking to the plan is hard because of the three S: Scare you : The equity market tries to scare you into selling through ABCD (all-time highs; bad news; crash predictions; cash calls by experts; declines) Slow you down with entry anxiety: Waiting for a 10% correction to deploy funds—as it always feels like markets will fall further. Seduce you with ABCD : Temptations to go all in; borrow to invest; chase performance and concentrate heavily; derivatives and day trading. Mint's Guru Portfolio series features leaders in the financial services industry who share their money management secrets.
