Silver, gold give better returns, beat stocks

GoldNew Delhi: In terms of investor wealth addition, gold and silver have offered better returns so far this year than other asset classes, especially stocks, by registering up to 41 per cent gains.

Gold and silver prices have surged 22.29 per cent and 41.14 per cent, respectively, so far in 2016.

On the other hand, the 30-share barometer Sensex has risen just 4 per cent. The index had plummeted to its 1-year low of 22,494.61 on February 29 this year.

It is also down 9.5 per cent from its all-time high of 30,024.74, which was attained on March 4, 2015.

Earlier in the year, market sentiment was hit mostly by volatility in crude oil prices and concerns over health of the Chinese economy.

However, markets bounced back from March onwards amid support from good corporate earnings, improving domestic indicators and pick-up in monsoon.

According to the experts, gold outperforms other asset classes during weak markets as investors are driven by the safe haven syndrome.

Gold prices have risen to Rs 31,050 per 10 grams, from Rs 25,390 as on December 31, 2015, whereas silver went up to Rs 47,000 per kg, from Rs 33,300.

Historical data showed that gold has given positive returns in 12 out of the last 15 years.

In a double-whammy for investors, the two major asset classes — stocks and gold — failed to generate positive returns last year.

However, in 2014, the stock markets had outperformed gold and silver for the third year in a row with much better returns for investors.