Jul 27, 2026, 02:45:11 PM IST

After a sharp correction in late 2025 and early 2026, smallcap stocks have staged a strong recovery this year, outperforming other asset classes. Here's why the segment is leading and how other asset classes have fared in 2026, according to ET Wealth.

ETMarkets.com

Smallcap stocks delivered a return of 9.7% in the current calendar year so far. After a sharp correction in late 2025 and early 2026, smallcap stocks staged a strong recovery as earnings prospects improved and valuations turned reasonable.
The segment also benefited from a better risk-reward equation following the sell-off. However, the rebound was far from broad-based, with gains concentrated in a relatively small group of stocks rather than being evenly distributed across the universe.

Agencies

Gold delivered a return of 5.1% in the current calendar year so far. Gold continued to serve as an effective portfolio hedge despite heightened volatility. The metal drew support from recurring geopolitical tensions in West Asia, sustained central bank purchases, and concerns surrounding inflation and currency stability.

AP

Midcap stocks delivered a return of 3.7% in 2026 so far. Midcap stocks, meanwhile, benefited from a stable interest-rate environment and improving domestic demand, though returns remained moderate.

ETMarkets.com

Short-term funds and 10-year G-Sec delivered 2.9% and 1.9% returns respectively in 2026 so far. The 10-year gilt index delivered positive returns but significantly underperformed short-term debt instruments. Rising bond yields and concerns over inflation weighed on long-duration bonds, while higher accrual income helped short-term debt generate superior returns.

iStock

Silver yielded a negative return of 5.2% in 2026 so far. Silver emerged as the laggard in 2026 so far. Following an extraordinary 169% rally in 2025, the metal came under pressure from profit booking, expectations of higher real interest rates, and volatility across precious metals. Although long-term industrial demand linked to clean energy and technology remains supportive, silver witnessed a sharp correction from its previous highs.

IANS

Largecap stocks stood last in the return chart in 2026 so far. The category delivered a negative return of 7.5% in 2026 so far.

ETMarkets.com

Over the past decade, silver has been the best-performing asset class, followed by gold. The strong performance of precious metals reflects an era marked by uncertainties, including the pandemic, geopolitical conflicts, elevated inflation, increased central bank buying and periodic weakness in major currencies.

TIL Creatives

Among equity segments, midcap stocks delivered the highest returns, driven by robust earnings growth. Although largecap stocks trailed both mid- and smallcaps in terms of returns, they continued to create decent wealth over the decade.

iStock