Stocks vs gold vs MF vs FD: Which investment is better amid market volatility (2024)

Livemint spoke to 3 experts to know which investment tool is better amid the volatility in the market.

Amit Gupta, MD, SAG Infotech

In the long run, low risk assets like FDs and gold may both help you amass a respectable corpus. In a word, if you are searching for long term investments in Gold, you may earn from larger returns as well as save on tax; not to mention, with a little of market volatility occasionally.

FDs, on the other hand, might provide you guaranteed returns even if they are guaranteed to be lower and are not impacted by market volatility. You may, however, do your homework and make investments based on your risk tolerance and financial objectives after taking the aforementioned considerations into account.

When you purchase a share, you get legal ownership in the business, along with voting rights and the right to a portion of the revenue generated by the business. You can communicate with the corporation and take part in the annual general meetings.

When you make an investment in a mutual fund, you receive a portion of the pooled funds amassed by other participants. The quantity of mutual fund units you bought during the investment constitutes your share. Your advantages and privileges are only available through the mutual fund company.

Equity may be acquired by investing in stocks, but when it comes to mutual funds, you can purchase one or more asset classes or sub-asset classes because mutual fund schemes are able to hold a diverse portfolio. Mutual fund investing is an indirect form of stock market involvement.

Amit Khare, AVP- Research Commodities, Ganganagar Commodity.

Gold prices have surged more than 109 percent since January 2014, while the domestic equity market, especially the Nifty index rose more than 110 percent during the same period. A couple of factors including the Russia-Ukraine war, sustained outflows by foreign institutional investors and an increase in repo rate weighed market sentiment on Dalal Street, Mutual funds have given 8-15 percent return over the same period, but fixed deposit return is almost 5-6 percent only.

Invest 50% in gold and 50% in equities

So as per above data we can conclude that Gold and Equities have given more return, So investors should invest 50% in Gold and 50% in Equities, Only old age people and low risk investors can invest in FD, said Amit Khare

Nirav Karkera, Head of Research, Fisdom

Broader equity markets are expected to continue the sideways performance through most of the year. While the current year may not be one of upside, it does offer an array of opportunities for long term investors to accumulate into high-conviction ideas.

Fixed deposits may outperform quite some equity products

Fixed deposits may outperform quite some equity products in the current year, but fixed deposits is anyway a suitable product for anyone looking to invest for a period as short as a year. Considering the state of global inflation and macroeconomics, gold looks well positioned with anticipated tailwinds outweighing challenges to the commodity’s price, said Nirav Karkera.

He suggested that investors should overall, select funds belonging to robust categories of dynamic asset allocation and multi-asset allocation mutual funds should be a good bet for retail investors seeking a simple yet effective investment solution.

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Published: 03 Mar 2023, 11:47 AM IST