Diversifying investments across real estate, equity, debt, gold is a must for long-term wealth creation shows comparison of returns over 11 years

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Sameer Bhardwaj

, ET BureauLast Updated: Jun 02, 2025, 06:30:00 AM IST

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Synopsis

Welcome to TrendMap, your quick, visual guide to the performance of different investment segments. In this edition, we present an 11-year performance tracker of various asset classes. The annual returns are ranked for multiple asset classes across equity, debt, precious metals, and real estate. This map shows that no single asset class reigns supreme. Hence, diversification helps.

Asset diversification — Diversifying your investments across various asset classes is the only sure-shot way to long-term wealth creation.

Volatility lifts gold, sinks small caps in 2025

Global uncertainties, rising demand from world central banks and higher equity market volatility led to a substantial jump in gold prices in 2025. Moreover, its low correlation to risky assets makes it a superior option for risk diversification. On the other hand, the mid cap and small cap benchmarks performed the worst among asset classes in 2025 year-to-date. Concerns of high valuations, export growth uncertainties and pressure on profit margins due to a tepid demand environment led to their poor performance.

Based on the average and standard deviation of returns over the last 11 years, gold has a better risk-to-reward ratio compared to silver. In equities, the large cap segment has a better risk-toreward ratio compared to the mid and small cap segments.