Gold vs Nifty 50: Where Should You Invest Rs 5 Lakh For Higher 5-Year Returns?

Physical gold remains a reliable asset, particularly in times of economic uncertainty, underperforming equities, or high inflation. Over recent years, however, equity investments have generated substantial wealth for investors, turning many into overnight success stories and allowing ordinary individuals to benefit from India’s largest listed companies.

Those investing in either physical gold or the Nifty 50 index generally do so to achieve strong returns. The question remains: which of the two delivers better results over time? Could gold make you wealthy in five years, or will the Nifty 50 outperform?

While both are distinct asset classes and respond differently to market conditions in the short and long term, a fair comparison reveals which investment may have been more lucrative over the past five years, especially if one had invested Rs 5 lakh.

Gold’s Performance Over Five Years: Five years ago, on July 7, 2020, the price of 22-carat gold in Mumbai stood at Rs 4,626 per gram. As of July 2025, the same gold trades between Rs 8,861 and Rs 9,000 per gram, a growth of 91.54%. Therefore, a Rs 5 lakh investment in physical gold in 2020 would now be worth Rs 9,57,700.

Nifty 50’s Five-Year Performance: The Nifty 50 index, representing India’s top 50 companies, closed at 25,522 on July 8, 2025. This marks a 135.76% increase over five years. Hence, an investment of Rs 5 lakh in the index would have grown to Rs 11,78,800 in the same period.

Though gold may have delivered stronger returns over the past year, the Nifty 50 has significantly outperformed gold over the past five years, demonstrating the power of long-term equity investment.