Gold and the stock market have been hot investment options in 2024, both offering impressive returns. While gold has been traditionally seen as a safe and reliable choice, the stock market has its appeal, with its potential for high returns. This year, gold has slightly outpaced the stock market, leaving many investors wondering which is the better choice for the future.
How Did Gold Perform This Year?
Gold has performed remarkably well in 2024. At the start of the year, the price of 24-carat gold was around ₹63,000 per 10 grams. As of now, it has crossed ₹75,000 per 10 grams, translating to a return of around 19% in just nine months. This means that if you had invested ₹1 lakh in gold in January, your investment would now be worth ₹1.19 lakh — a profit of ₹19,000.
Gold’s rise this year has been fueled by global economic uncertainties and its reputation as a safe-haven asset during times of crisis. With inflation concerns and market volatility, many investors have turned to gold to safeguard their wealth.
How Did the Stock Market Perform?
The stock market has also had a strong run in 2024, although its returns have been slightly lower than gold. The Sensex has offered about 18% returns this year, while the Nifty 50 index has given around 20%. The Nifty Bank Index, on the other hand, has provided a return of 11.60%.
If you had invested ₹1 lakh in a stock on Sensex at the start of 2024, your investment would now be worth ₹1.18 lakh, offering a gain of ₹18,000. Though the stock market’s returns are just behind gold, it remains a highly profitable option for investors willing to take on more risk.
Future Prospects: What to Expect?
Looking ahead, both gold and the stock market have promising potential, but their movements depend on various factors.
Gold Prices Set to Rise
Experts predict that gold prices will continue to rise in the coming months. With festivals like Dhanteras and the wedding season approaching, demand for gold is expected to increase, driving up prices. Additionally, a potential reduction in interest rates by the US Federal Reserve could further boost gold prices. Some estimates suggest that by early 2024, gold may cross ₹80,000 per 10 grams, offering even more attractive returns for investors.
Stock Market Likely to Surge
The Indian stock market has been buoyed by strong foreign investment and a positive economic outlook. The recent interest rate cuts by the US Federal Reserve have also contributed to the stock market’s upward trajectory. Experts believe that the Sensex could cross the 1 lakh mark by the end of 2024, driven by increased investor confidence and economic growth.
Which is the Better Investment?
Both gold and the stock market have their strengths. Gold is seen as a safer investment, especially in uncertain times, and its value is expected to rise soon. On the other hand, the stock market offers higher potential for returns, though it comes with more risk.
For investors looking for stability, gold is a solid choice. However, those willing to take on more risk for potentially higher rewards may prefer the stock market. Ultimately, your choice will depend on your financial goals, risk appetite, and investment horizon.
Diversification is Key
Instead of choosing one over the other, many financial experts recommend diversifying your investments across both gold and the stock market. This strategy allows you to benefit from the growth potential of stocks while also having the security of gold during market downturns.
By spreading your investments, you can achieve a balanced portfolio that maximizes returns while minimizing risk.
