If the Rs 1 lakh Rakhi gift you got last year had been invested rather than spent, the value of that money could have changed dramatically depending on the asset chosen. Among the Indian assets in this comparison, silver emerged as the biggest winner and delivered a staggering 108% return over the period.
That means a hypothetical Rs 1 lakh investment in silver would have grown to Rs 2.08 lakh and a profit of Rs 1.08 lakh in just one year.
Gold also managed to shine, and mid-cap stocks far outperformed the Nifty. On the other hand, the Nifty was at a slight nibble.
Silver More Than Doubled The Rakhi Gift
Silver was by far the best-performing Indian asset in comparison. With a 108% return, the precious metal more than doubled the original investment.
A Rs 1 lakh investment would have turned into about Rs 2,08,000, a gain of Rs 1,08,000.
The large rise indicates that silver was quite well-performing during the period and indeed outperformed others in various traditional investment paths.
Gold Delivered Nearly 56% Return
Gold ranked second among Indian assets. It generated a 55.92% return, taking the hypothetical Rs 1 lakh investment to Rs 1,55,920.
This translates to a profit of Rs 55,920 year-on-year.
Gold and silver were such big winners, and precious metals were the main beneficiaries of this period.
Mid-Cap Stocks Also Performed Well
Equity investors looking to buy mid-cap stocks would have also enjoyed a lot of gains.
The Nifty Midcap 150 gained 28.26%, meaning Rs 1 lakh invested in the index would have grown to Rs 1,28,260.
The Nifty Smallcap 250, however, delivered a more modest but still positive 11.55% return, which took the hypothetical investment to Rs 1,11,550.
Retail sugar prices also saw a significant increase of 37.70% that would have taken the equivalent value of Rs 1 lakh to Rs 1,37,700.
Fixed Deposit Offers Modest Growth
Investors who prefer stability over high returns would have been pleased with a fixed deposit for much smaller returns.
A hypothetical 6.25% FD return would have increased Rs 1 lakh to almost Rs 1,06,250.
Even if the return would have been much lower than silver, gold or mid-cap equities, fixed deposits are generally attractive to investors who are seeking predictable returns and lower risk.
Nifty Delivered A Negative Return
The benchmark Nifty was the least performing among the Indian financial assets in the comparison.
The index returned negative 0.86%, which would have reduced a Rs 1 lakh investment to around Rs 99,140.
That means the hypothetical investor would have lost Rs 860 over the period before taxes, brokerage or other costs.
What If The Rakhi Gift Was $1,000?
The global comparison also shows major differences between asset classes.
A $1,000 investment in Brent crude would have made a 31.84% return, so the total investment would have been around $1,318.
In another good performance, the Nasdaq 100 rose 23.77%, taking the hypothetical $1,000 investment to the level of $1,238.
The S&P 500 returned 20.13%, which would have increased the investment to $1,201.
The dollar index was relatively stable and rose by only 1.04%. A $1,000 investment would have grown to around $1,010.
Bitcoin Was The Biggest Laggard
Bitcoin was the worst performer in the global comparison. The cryptocurrency declined 31.10%, reducing a $1,000 investment to approximately $689.
The difference between the best and worst-performing global assets was therefore substantial.
A $1,000 investment in Brent crude would have generated a gain of about $318, while a $1,000 investment in Bitcoin would have resulted in a loss of about $311. The difference is about $629.
Where The Rakhi Money Went Made A Huge Difference
The hypothetical exercise shows just how different asset classes can perform over the same period.
In India, silver led the way with a 108% return, followed by gold at 55.92% and the Nifty Midcap 150 at 28.26%. The broader Nifty ended the month with a negative return.
Globally, Brent crude was the most popular among these assets, while Bitcoin suffered significantly.
But investors need to remember that these are historical returns and past performance does not guarantee future returns. Actual investment outcomes can also vary depending on taxes, transaction costs, entry prices, and the specific investment product used.
But don't forget the Rakhi investment comparison is interesting: where the money is invested can make a big difference to how much a gift is worth one year later.
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