Periods of global uncertainty—like the 2008 financial crash, the COVID-19 pandemic, the ongoing Russia-Ukraine war, and today’s inflation shocks—have revealed a hard truth: relying on a single asset class is risky. While equities crashed in each of these events, gold soared, protecting wealth and delivering stability.
In 2008, stocks collapsed but gold surged. In 2020, markets tanked 30% in weeks, yet gold jumped 25%. In 2022, geopolitical turmoil once again rattled stocks—while gold hit record highs. Today, as rising inflation and volatile rates buffet global markets, gold is holding strong while equities wobble.
Equity vs Gold: A Clear Divide
Equities outperform in growth cycles but are exposed in crises. Gold, meanwhile, shines in chaos but lags in boom periods. This split proves one thing: diversification is essential. A multi-asset strategy that blends equity, gold, debt, and real estate helps investors thrive across market cycles.
Snapshot of Asset Yields
- Stocks: 4.5% earnings yield
- Bonds: 6.5%
- Gold: Has doubled in value in 3 years
- Real Estate (Mumbai): 3.5–4% rental yield
- Cash/Overnight Funds: 6.4%
Every asset has had its moment. Stocks have led over the past five years, bonds have surged with falling rates, and real estate is booming in urban hotspots. But only diversified portfolios have consistently minimized shocks while capturing gains.
The Smart Play: Multi-Asset Funds
Today’s top investment minds recommend multi-asset funds—professionally managed blends of equity, gold, debt, and more. These funds adjust to market shifts, offering growth and capital protection in one package.
In today’s volatile world, don’t gamble on just one asset. A diversified portfolio isn’t just smart—it’s non-negotiable for wealth creation and protection.
Kalpesh Dave
Dy CEO – Bajaj Capital Ltd
