If equity has the highest long-term return, why should I hold debt or gold at all?
Published 19 September 2026
If I have a 15–20 year investment horizon, wouldn’t I be better off putting everything into equity? What is the point of holding lower-return assets like debt or gold?
Because every asset in the portfolio has a different job.
Indian equity is the growth engine. Debt is the stabiliser. It can hold money required for nearer-term goals and reduce the chance that you are forced to sell equity when markets are falling.
Gold is a different return driver. It can remain stagnant for years, but it can behave differently during financial stress, inflation concerns, geopolitics and rupee weakness.
The purpose of diversification is not to make every asset outperform. It is to have different assets respond differently to the same event.
“When one asset is having a terrible year, you want another part of the portfolio that is not.”
“A good portfolio is not four assets thrown together. Every asset needs a job.”
This is not personalized investment advice. Your goals, time horizon, risk tolerance and financial situation may be different, so assess your own situation and discuss it with your financial advisor.
Indian equity is the growth engine. Debt is the stabiliser. It can hold money required for nearer-term goals and reduce the chance that you are forced to sell equity when markets are falling.
Gold is a different return driver. It can remain stagnant for years, but it can behave differently during financial stress, inflation concerns, geopolitics and rupee weakness.
The purpose of diversification is not to make every asset outperform. It is to have different assets respond differently to the same event.
“When one asset is having a terrible year, you want another part of the portfolio that is not.”
“A good portfolio is not four assets thrown together. Every asset needs a job.”
This is not personalized investment advice. Your goals, time horizon, risk tolerance and financial situation may be different, so assess your own situation and discuss it with your financial advisor.