“Follow a typical 65% equity, 25% debt, and 10% precious metals strategy,” says Wealthy. in cofounder Aditya Agarwal. He advises investors to stagger their equity investments over the next 12 months.
As investors head into 2026, the impact of US tariffs and the rupee’s sharp depreciation, as well as slow corporate earnings growth, are some of the worries on the fundamental side. There are also concerns about a long IPO pipeline that could suck out liquidity from the secondary market and dampen returns.
Wealth managers are advising investors to avoid recency bias and not to get carried away by allocating more to asset classes chasing recent performance.
In calendar 2025, silver has been one of the best-performing asset classes, yielding returns of 128%, followed by gold at 72%. In comparison, the Nifty 50 returned 10.32%, while the Nifty Midcap 150 gained 3.64% and the Nifty Smallcap 250 lost 9.17%.
“The gold/silver ratio indicates that the rally in precious metals will top out sometime in 2026. Investors could hold 5-10% precious metals in their portfolio, purely to diversify and from a long-term perspective,” says Equirus Wealth chief investment officer Chanchal Agrawal. Investors with high allocation to precious metals could take some money off the table, advises Agrawal.Fund managers believe 2026 is going to be a difficult year to earn returns from equities. Investors will have to try hard to generate returns that beat market benchmarks.“One will have to watch out for days where there are sharp dips and deploy capital at such times,” says Agarwal.
According to a study by Kotak Mutual Fund, current equity valuations are above long-term averages—this means investors will have to be cautious while allocating new money. The Nifty50 currently trades at a price-earnings ratio of 21.5 compared with its 10-year average of 20.8, while the Nifty Midcap 100 trades at 25.1 compared with its 10-year average of 23.1. For the Nifty Smallcap 100, the PE ratio of 29.2 is significantly higher than the 10-year average of 16.7.
“Valuations of large caps are reasonable, and investors should have a large-cap bias with a low allocation to midand small-cap funds,” says Vineet Nanda, founder of SIFT Capital. Nanda advises investors to lower their return expectations given the lower inflation. He expects a 12% return from equities over the next two to three years.
Investors should also not ignore fixed income, since the real rate of return is high due to low inflation. For tax efficiency, rich investors could opt for an income-plus-arbitrage fund of funds scheme, where they will pay a 12.5% tax only after holding for more than two years. Those in low tax brackets could consider Government of India Savings Bonds or corporate fixed deposits.
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