New Delhi: Indian equities (Sensex) have outperformed assets such as real estate, gold, 10-year bonds and bank fixed deposits over 10, 15, 20 and 25 years compared to other categories, Morgan Stanley has said in a report. Have done. However, to achieve this return (pre-tax), investors need to be able to take risk while investing and tolerate fluctuations in stocks, the report said.
According to Morgan Stanley, equities (Sensex in this case) delivered pre-tax returns at a compound annual growth rate of 15 per cent over a 25-year period, which is better than gold (11.1 per cent), bank FDs (7.3 per cent). , However, equity investors faced higher volatility of 30.7 per cent for these returns, compared to 11.3 per cent for gold and 1.6 per cent for bank FDs.
According to the Morgan Report, if we look at wealth creation over the last decade, it is estimated that households have accumulated $8.5 trillion in wealth, of which about 11 percent has come from equities. The report said that the rise in gold prices has led to a sharp increase in wealth.
Indian households still invest less in equities. Only 3 percent of households’ financial assets are in equities. He believes that this number may increase to double digits in the coming years. Morgan Stanley estimates that excluding founder assets, equity holdings represent about 8 percent of household finances at current market prices.
