India’s stock market remains a strong engine of wealth creation among asset classes, according to the September Wealth Conversation Report released by FundsIndia on Monday.The report compares two decades of performance across equities, gold, debt and real estate, showing equities providing good results for long-term investors.
Indian markets multiply investor wealth 13 times in 20 years
Indian equities have proved to be a promising bet for long-term wealth creation, with the Nifty 50 multiplying nearly 13 times over the past 20 years. This translates to an annualised return of about 13.7%, far ahead of debt and real estate. Over a 35-year horizon, domestic equities compounded at 13.6% CAGR, multiplying wealth by 88 times.Within equities, the Nifty Midcap 150 delivered a 16.2% CAGR, multiplying wealth 20 times in two decades, while the Nifty Smallcap 250 rose at 14.2% CAGR, growing 14 times. Large-cap stocks, represented by the Nifty 100, compounded at 13.9% CAGR, multiplying 13.6 times.Probability-based analysis showed that short-term equity investing carries higher risks: negative returns occurred 46% of the time for intraday trades, 39% for one-month holdings, 31% for six-month holdings, and 23% for one-year holdings. However, this risk dropped sharply over longer horizons — only 6% for three years, 0.1% for five years, and NIL for seven to ten years.The report further noted that Indian equities doubled in 6–7 years about 73% of the time, tripled in 10–11 years about 80% of the time, and multiplied 4 times in 12–13 years about 76% of the time.
Other asset classes
Gold has returned a 14.8% CAGR, multiplying wealth almost 16 times over 20 years.Debt has provided steady 7.5% returns, while real estate delivered 7.7% CAGR in the same period.India’s case for staying investedFundsIndia’s analysis underscores that time in the market matters more than timing it.Over 7-year periods, Indian equities have never produced negative returns, according to the report.
USA’s S&P 500
Globally, the US equity benchmark S&P 500 returned a 14.7% CAGR, multiplying investor wealth by 15.6 times over the past 20 years.
