$3 trillion in household gold sits idle as Indian companies seek capital: Nithin Kamath flags investment paradox

Highlighting a striking contrast between the vast gold holdings of Indian households and the capital needs of Indian companies seeking growth through equity markets, Nithin Kamath, the co-founder and CEO of Zerodha, recently shared a post on social media platform X (formerly Twitter).According to Kamath’s post, Indian households hold an estimated $3 trillion worth of gold, a figure sourced from the World Gold Council. He pointed out that much of this gold lies idle in safety deposit boxes, which contributes little to the financial ecosystem, unlike equity investments, which finance companies and fuel economic expansion.

“We need better ways to financialize this gold, beyond just gold loans,” Kamath stated in his post.

In addition to his comments, Kamath shared a comparative bar chart of annual returns of gold and the Nifty 500 index from 1996 to 2025. The chart visually illustrates how the performance of gold and stocks have fluctuated over the years.

The data shows that both gold and stock returns have experienced periods of strong growth and steep declines. For example, equity markets posted significant returns in 2003 (101%), 2004 (105%) and 2009 (91%)—at the center of attention for years when the Nifty 500 posted triple-digit calendar year gains. Conversely, there were also periods of deeply negative returns for equities, such as in 2008 (-57%), 2001 (-22%) and 2011 (-26%).

Gold, on the other hand, has delivered relatively stable but moderate returns for many years. Some notable peaks were observed in 2011 (32%), 2020 (27%) and 2024 (expected 16%), with relatively fewer years of negative performance compared to equities.

The chart also highlights the calendar year 2020 as an “outlier”, when both asset classes registered positive returns amid the Global Covid-19 pandemic, with the Nifty 500 rising 16% and gold yielding 27%.

Also read: After a 50% rally in gold and silver, how much higher can gold go this Diwali?

(Disclaimer: recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of the economic times)