As Diwali festival approaches, with just a day away, households across India are preparing to celebrate the festival dedicated to Goddess Lakshmi, symbolising
wealth and prosperity. Traditionally, this is the time when people flock to jewellery stores to buy gold, seen not just as a purchase or investment but as a symbol of auspiciousness. However, several investors are searching whether gold is still worth buying, or should equities take the spotlight? Know what analysts recommend
Gold’s returns vs Nifty50
Gold has delivered exceptional returns over the past year.
MCX Gold has surged 60 per cent since last Dhanteras (October 29, 2024, to October 17, 2025). By comparison, the Nifty 50 has returned only 5.22 per cent during the same period.
Looking at the long-term performance, gold has outpaced equities in the last decade. While the Nifty Total Return Index delivered a 13.5 per cent CAGR over the last 10 years, gold provided 15.16 per cent CAGR in the same period.
What should investors do? Purchase gold or equities this festive season?
Analysts have suggested that balance is key. The ideal asset allocation during times of uncertainty is:
- 60 per cent in equities
- 30 per cent in debt
- 10 per cent in gold
Depending on your risk profile and age, this ratio may change. Conservative investors may favor debt and gold more, while aggressive investors may allocate a larger portion to equities.
Moreover, Axis Direct recommends accumulating gold on dips between Rs 1,05,000 and Rs 1,15,000 per 10 grams with a potential upside target of Rs 1,45,000 to Rs 1,50,000 by next Diwali.
Globally, if gold sustains around $3,800 per ounce, it could target $4,700–$4,800 in the medium term.
For silver enthusiasts, the trend is equally bullish. According to Motilal Oswal’s report Silver 2030: The Unprecedented Rise, silver could hit $75–$77 per ounce by 2027, nearly a 60 per cent increase from current prices. In India, this translates to Rs 2,45,000 per kg by FY27.
If you already hold sufficient gold, experts advise buying only on dips.
Advice for new investors
For new investors, consider coins or bars for lower making charges or digital gold for a hassle-free, cost-efficient alternative.
Why are gold prices surging?
Several factors are driving the recent surge in gold prices:
- Uncertainty: Ongoing Russia-Ukraine tensions, US-China trade disputes, and volatility in the Middle East make gold a safe haven.
- US Fed Reserve Policy: Potential rate cuts and political interference in Fed decisions have influenced global gold prices.
- Industrial Demand: Emerging technologies are increasingly using gold as a raw material.
- Weak Dollar: The US Dollar Index has dropped nearly 10 per cent in 2025, making gold more attractive.
- Central Bank Purchases: Central banks continue to add gold to reserves, with around 1,000 tons expected this year.
- Gold ETFs: Rising interest in gold ETFs has further boosted demand.
Moreover, the yellow metal remains a compelling investment option this Dhanteras.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
