Equities best investment in past 25 yrs: Report

Mumbai, Sep 4 (PTI) Equities, not just in the domesticcontext but across the globe, have been the best asset classin the past 25 years, with the Sensex and the Nifty being thesecond best performers among top 10 global indices with anaverage of over 12 per cent returns. The Shanghai Composite Index of China tops the list amongtop 10 global indices by giving a CAGR of 12.9 per cent duringthe 25-year period, according to an analysis of various assetclasses and their returns by the city-based brokerage CentrumGroup. The data pertains to the 25-year period ending July 31,2016 and are in local currency terms, the brokerage said. Our study prove that the equities have trounced allother asset classes – be they currencies or commodities orreal estate, by a wide margin. Of course some of these assetclasses have given higher returns over a short-term, but forthe long term it is definitely the equities, Centrum analystsSweta Chawla and Siddhartha Khemka said. "These numbers confirm the belief that equities havecreated more wealth for their holders than other assetclasses. Of course, this has happened over a longer time frameand the asset class comes with its own set of volatilities inthe shorter time frame," they told PTI. While the Sensex has given in a CAGR of 12 per centfor past 25 years, Nifty has been a notch better at 12.1 percent, while in dollar terms this have been 7.9 per cent each. Against this, the Shanghai index gave in 11.9 per centduring the period in dollar terms. Over the past 10 years, the Sensex and Nifty top thechart with 10.1 per cent and 10.7 per cent respectively, whilethe shanghai was a low 6.7 per cent. Similarly, from a five-year perspective, too, thedomestic indices have come in a close second with 9.1 and 9.6per cent respectively against 10.9 per cent return by theNikkei and S&P500, and Dow Jones at third with 8.8 per cent.Against this, the Chinese index has been the worst performerwith a paltry 2 per cent returns during the same period. The Brazilian index Bovespa has given 11.8 per cent , 4.5per cent and -14.2 per cent for the 20, 10 and 5 year periodsas 25 year data is not available. In the case of the Germanindex DAX the returns for the 25, 10 and 5 year period havebeen 7.7 per cent, 6.1 per cent and 7.6 per cent, and that ofthe Hang Seng of Hong Kong it has been 7 per cent, 2.7 percent and 0.4 per cent. The British FTSE’s stood at 3.9, 1.3 and 2.9 per centeach, and French CAC has given back 3.8,-1.2 and 3.9 per cent. But the third largest index Nikkei has beendisappointment over the 25 years with a negative -1.5 per centreturn, 0.6 per cent for a 10 year period in terms of the yenbut the best in the 5-year tenor at 10.9 per cent. (MORE) BENNP MRABMSRE