KARACHI: Gold outperformed all major invest­ment avenues by a significant margin in 2022, a research note issued by Topline Securities showed on Tuesday.

It was followed by one-year (dollar-based) Naya Pakistan Certificates and the US currency as the best-performing assets in the outgoing year.

These three asset classes provided returns that were higher than the estimated average inflation of around 20 per cent in 2022.

Gold posted a gain of 41pc as its rate rose from Rs108,200 per 10 grams to Rs152,700. Its rate increased 11pc in 2021.

In the local bullion market, gold has rallied in line with the rising dollar rate in the black market. Currently, the precious metal is mainly valued at the black market parity rather than the official rate, which is 10pc lower, it said. In contrast, gold remained “more or less stable” in 2022 in the international market.

Naya Pakistan Certificates and US currency offer second- and third-best returns; PSX investors remain losers

Investors holding dollar-based Naya Pakistan Certi­ficates — a scheme under the Roshan Digital Acc­ounts (RDAs) — also made a gain of 36pc in rupee terms. That was mainly because of a falling value of the national currency.

Similarly, people who held onto dollar bills registered a gain of 28pc in 2022. The official bank rate of the dollar rose from 177 at the end of 2021 to Rs226 as of today.

The brokerage house noted that many investors transferred their capital to fixed-income instruments in 2022 owing to rising interest rates. The policy rate in Pakistan increased from 9.75pc to 16pc in the outgoing year. As a result, the average gain on a three-month treasury bill remained 14pc. Similarly, local money market funds also generated a 14pc average return in 2022.

The average return on bank deposits, excluding current accounts, and Special Saving Certificates issued by the government was 11pc each in 2022.

The property sector, which is a popular investment avenue among Pakistanis, took a hit in 2022 on macroeconomic concerns. Indices tracking the prices of houses, plots and the residential property went up 12-14pc in 2022, it said.

Pakistan’s weak external account situation, rising interest rates and political uncertainty led to a lower level of enthusiasm among investors for equities and bonds.

The prices of government bonds fell owing to a rising policy rate. The benchmark 10-year Pakistan Investment Bond posted a negative return of 2pc.

The stock market along with equity-based mutual funds underperformed all major asset classes in 2022 with the benchmark KSE-100 index falling 10pc.

Published in Dawn, December 28th, 2022