For investors looking to participate in gold’s rally, Sivaram believes exchange-traded funds (ETFs) are the smartest route, especially after taxation was simplified in recent budgets. He said, “ETFs are the best option because they are cheap, easy to buy, and now enjoy long-term capital gains benefits.”
Sivaram also highlighted how central banks are driving global gold demand, buying nearly 1,000 tonne every year—almost 25% of total annual demand. With countries like China and India leading these purchases, he doesn’t see this trend slowing anytime soon.
While many view gold as volatile, Sivaram’s analysis over 25 years shows otherwise. Both gold and the Sensex had five negative years, but gold’s declines were much smaller. “Gold has been a very stable asset class,” he said, adding that investors should not expect 50% annual gains but can reasonably aim for 9-10% long-term returns.
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He cautioned that Indian investors should focus on rupee gold performance rather than dollar gold, as currency movement plays a crucial role. Between 1980 and 2000, for instance, while dollar gold fell 60%, rupee gold rose 230%, thanks to currency depreciation.
On the equity front, Sivaram acknowledged that gold has outperformed equities in 2024, but he sees India’s recent market underperformance as cyclical, not structural. “Markets are slaves of earnings,” he said, expressing confidence that financials and consumption will drive a comeback in FY26.
Sivaram remains optimistic about financials, power, and travel-related sectors, which he believes will benefit from rising capex, reforms, and strong domestic demand.
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For the entire interview, watch the accompanying video
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