Gold prices could swing between 7% decline and 20% gain in FY26

Gold prices may experience significant volatility in FY26, with potential movements ranging from a 7% decline to a 20% gain, according to a report by SmartWealth.ai, a smallcase manager.

 

SmartWealth.ai’s analysis reveals that gold has delivered a 12.3% CAGR over the past 10 years (2016–2025), nearly catching up with the Nifty50’s 11.4% CAGR over the same period. On Akshaya Tritiya alone, gold prices have surged 166.79% since 2015, demonstrating its long-term value as a wealth-preserving asset.

 

FY26 Outlook: Volatility Ahead

• Using its Diversified Momentum Investing (DMI) framework, SmartWealth.ai projects that:
• Gold may rise between 3%–7% by Akshaya Tritiya 2026 under base-case scenarios.
• However, broader fluctuations between a 7% fall and a 20% gain are possible depending on market stress and geopolitical developments.
• Equities (Nifty50), meanwhile, show a mild downward bias, with a potential range between a 7% decline and a 3% gain in the near term.

• In such a regime, diversification and dynamic risk management are critical. 

 

Also read: Gold Price in Mumbai | Gold price in Delhi | Gold Price in Indore | Gold Price in Lucknow  Gold, long treasured for its emotional, economic, and ornamental value, continues to shine as a timeless  asset in investor portfolios. According to the report, over the period of 10 years of Akshaya Tritiya, Gold  price has increased by 166.79%. 

 

 

“The past year  has been an outlier in market behaviour. The Nifty 50 has delivered over 7% returns, while gold has surged  by more than 30%. This profile of performance in equity and gold is exceptionally rare, with a historical  probability of occurrence below 2%. Looking ahead, the market regime and geopolitical environment  remain highly uncertain, making even short-term forecasts challenging. It is important to include gold in a portfolio—not necessarily in a traditional buy-and-hold manner, but at least as a dynamic diversifier and  hedge," said Pankaj Singh, smallcase Manager, Founder & Principal Researcher, SmartWealth.ai.

 

The smallcase Manager SmartWealth.ai’s  report reveals that gold has consistently acted  as a natural hedge during major equity market  downturns over the past 20 years.  

  “Gold tends to retain its value over time, making it a popular store of wealth when inflation erodes the  purchasing power of fiat currencies. When a local currency weakens (especially the U.S. dollar), gold prices  often rise, presenting an opportunity for preserving value in real terms. During times of crisis—such as  recessions, wars, or financial system instability—investors often flock to gold as a "safe haven" asset. Gold  often shows low or negative correlation with equities, so it can provide balance during stock market  downturns”, added Pankaj Singh, smallcase Manager.