Akshaya Tritiya 2023: Is it wise to invest in gold, silver today — explained

Akshaya Tritiya 2023 is getting celebrated across the nation today. Buying gold or silver on this day is considered auspicious and for years, Indians have been following this ritual. However, from investment perspective, if we look at the return given by both gold and silver in long term, the ritual looks an attractive investment option for a long term investor.

Comparing gold and silver rates today with their prices on Akshaya Tritiya two decades ago, we find that gold has given around 1000 per cent return whereas silver has surged near 900 per cent in this time. Taking gold price on Multi Commodity Exchange (MCX) on Akshaya Tritiya 2022, gold price has appreciated to the tune of 18 per cent in last one year whereas silver has delivered 19 per cent return to its investors.

Meanwhile, if we look at equity return in this time, the BSE Sensex has delivered around 1900 per cent return to direct equity investors whereas in last one year, the 30-stock index has given around 4.70 per cent return to the index investors.

Why you should invest in gold, silver?

Speaking on importance of gold investment on Akshaya Tritiya, Anuj Gupta, Vice President — Research at IIFL Securities said, "On Akshaya Tritiya 2003, gold price was around ₹5,656 per 10 gm on MCX whereas the gold future contract for June 2023 on MCX is quoting ₹59,855 per 10 gm. Similarly, silver rate today on MCX is ₹74,670 per kg while on Akshaya Tritiya 2003, the white metal price on MCX was ₹7,550 per kg."

On return given by gold and silver investors, who bought these bullions on Akshaya Tritiya, market expert Sugandha Sachdeva said, "Looking back to Akshaya Tritiya 2003 (twenty years ago), gold has delivered annualized returns of more than 12 per cent since then, while in absolute terms it has garnered whopping returns of around 1000 per cent as prices were trading at ₹5656 per 10 gm mark back then. Even as we compare the returns of gold since Akshaya Tritiya 2022, prices have surged by almost 18 per cent and there is scope for a further rise in the precious metal from a long-term standpoint.

On return given by gold in last 10 years, Amit Khare, AVP-Research Commodities at Ganganagar Commodity said, "Gold has given 9.23 per cent of average return on every Akshaya Tritiya in the last 10 years. If we talk about the range for the next one year (Akshaya Tritiya 2023 to Akshaya Tritiya 2024) ₹57,000 to ₹64,000 per 10 gm may be the range for this year. So investors should invest in the lower range and should book on the upper range." Amit Khare said that MCX gold price was at ₹26,854 per 10 gm levels on Akshaya Tritiya 2013.

See Akshaya Tritiya gold price for last one decade:

On factors that fueled gold and silver prices in last one year, Naveen Mathur, Director — Commodities and Currencies at Anand Rathi said, "Recessionary fears, Central Bank buying & Dollar weakness are the major factors that could enhance returns till next Akshaya Tritiya, whereas gold is still expected to average in the range of Rs. 59,000 – 60,000 / 10 gm over & above Rs. 51,058 / 10 gm average on MCX seen in 2022 providing 16 -20 % returns amid its safe haven appeal. Meanwhile expectations remain for Gold to trade in the range of $ 1870 - 2190 on Comex (CMP $1985/ounce) for 2023. On MCX we might expect prices to remain volatile over the remaining period as may likely test Rs. 64,500 – 65,000 per 10 gm on the higher side in futures contract ahead of next Akshaya Tritiya.”

Gold vs silver vs stock market

Comparing the gold and silver returns with equities in last twenty years, Anuj Gupta of IIFL Securities said, "The BSE Sensex has ascended from 2,966 to 59,655 levels in last twenty years, delivering around 1900 per cent return to direct equity investors whereas in last one year, the 30-stock index has risen from 56,975 to 59,655, giving around 4.70 per cent return to the index investors."

Anuj Gupta went on to add that BSE Sensex has risen from 19,691 (Akshaya Tritiya 2013) to 59,655 levels (Akshaya Tritiya 2023), delivering around 200 per cent return to its investors. In this period, gold price has ascended from ₹26,854 to ₹59,855 per 10 gm levels while silver price in this period shot up from ₹45,118 per kg to ₹74,670 per kg levels.

See Akshaya Tritiya gold, silver and Sensex return in last 20 years:

Advising investors to invest in gold on Akshaya Tritiya 2023, Sugandha Sachdeva said, "On this propitious festival, apart from the traditional way of purchasing physical gold, there are a lot of other options available for investing in gold-be it sovereign gold bonds, gold ETFs, gold mutual funds, digital gold, or gold derivative contracts on the exchange platform. Preference for any of these alternatives shall be based on your risk appetite, time horizon, and investment objective."

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.