The Pakistan Stock Exchange recorded the best return for investors in 2024, with paybacks of more than 75%, when compared with other tools of investment.
Over the past year, from Jan. 1 through Dec. 20, the equity market delivered a remarkable return of 75%, inclusive of dividends, according to a report compiled by Topline Securities. The brokerage house said the benchmark KSE-100 index had performed better than bonds, gold, the U.S. dollar and real estate, the traditional investment options for Pakistanis.
According to the report, gold posted significant gains, with its price in the local market increasing by 24%, climbing from Rs. 189,386 to Rs. 234,311 per 10 grams. Internationally, gold rose from $2,092 per ounce on Dec. 29, 2023, to $2,617 per ounce on Dec. 20, 2024.
The U.S. dollar, a generally popular choice for Pakistani investors in recent years, yielded a negative 1% return, falling from Rs. 282 to Rs. 278 in the interbank market during 2024. This contrasts with returns of 24% in 2023 and 28% in 2022 of the greenback. Nonetheless, investors could have secured gains of 1-4% with U.S. dollar deposits, depending on interest rates.
The Topline Securities report noted a shift toward fixed income and low-risk investments amidst the prevailing high interest rates during the year. The year commenced with a policy rate of 22% and ended with an inflation rate of 13% on the back of faster-than-anticipated declines in inflation.
The report said the average bank savings rate was 18% in 2024, while the National Savings 3-Year Special Savings Certificate offered a 17% return. By comparison, it said, local asset management companies’ money market funds averaged a 19% return.
The Naya Pakistan Certificate, under the Roshan Digital Account, generated a 22% return in rupee terms.
The economic gains also benefit investors in government securities, with Pakistan Investment Bonds yielding a 27% return and T-Bills providing a 21% return, assuming 3-month T-Bills were reinvested quarterly.
The property market, meanwhile, had mixed results for investors. In Lahore, commercial and residential plot prices dropped by 11%, though residential prices rose by 14%. In Karachi, the prices of commercial plots decreased by 10%, while those of residential plots and houses increased by 5-7%.