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Equity vs Gold: Which is a Better Investment?

Investment

Investment is a doozy topic. The debate for investments using gold and equities have existed for a very long time in the market, but what is the real answer all these debates come to?

Investors already know the answer to this question. Investing in equities have always been more rewarding and while investing in gold might be a safe bet for a small amount of time, the history of the market has shown equity always outperforming gold in investments sector.

Why people still hold investment in gold to such high standards then? People often overlook the facts and fall for the old existing myths. The main reason people invest in gold is because of the mentality that the value of gold never diminishes. This wrong perception has existed for a long time and still does to a very large extent. The price of gold changes every day and although, it might be true that it usually goes up, it frequently goes down too and when it does, it takes hard hits. These hits are something that take a long and valuable time to recover. And with your funds tied in in the form of a physical component, it becomes a burden.

This perception also comes due to the fact that equities experience their all-time low recently during 2008 and the aftereffects of that were not pretty. But at the same time, it is also true that if you assess equity and gold side by side over the time period for the percentage increase in returns, gold very narrowly outperformed equity during their worse period. This period also, was one of the best time gold experienced in investments in recent history, booming its popularity.

But since then, the picture has returned back to normal, and equities yet again, have got a major edge on gold investments again. The growth of the market has become a major motivation for people to invest back in equity. But the impact of the bad times still are at hand in many people’s minds.

To clear things up easily, investing in either gold or equity is something that is long-term for you to get the maximum returns and benefits. But when it comes to gold, the market price always dwindles in the same region. But equity is a whole other scene. With an ever changing market and stocks experiencing the constant shifts, the returns from investing in equity are way higher. Along with that, there are many plans which you can opt for in an investment through an equity which comes with extra benefits. You can get tax cuts, exemptions, zero withdrawal charges, money accumulation and much more if you go for investing through equity. Mutual funds and SIPs have therefore become major players and the best options to opt.

Going about your way smartly and carefully for your investments is a practical thing to do and you should definitely check out the charts of returns over time periods for both gold and equity before making your choice.  That being said, the smartest and the most efficient way to go would be equity, with its many benefits and security from the companies you are investing through.

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