The Indian rupee is not one of the strongest currency in the world. In 2018 rupee was one of the five worst performing currencies in the world against USD as shown in the table below (Source: CRISIL Research, Dec 28,2018)
Rupee has deprecated by approximately 45% over the last twenty years (1998 to 2018), as shown in the table below ((Source: Data collated via sources available in the public domain).
In the same time period gold grew at the rate of approximately 656% (CAGR of 10.64%) as shown in the table below. (Source: Data collated via sources available in the public domain).
The deprecating rupee is one of the biggest destroyer of individual’s wealth. To protect against the deprecating rupees’ large companies, buy a currency hedge from the banks. Individuals cannot buy a currency hedge similar to what companies do. However, individuals can buy gold as an effective way to hedge against the currency deprecation.
To protect one’s wealth against the deprecating rupee, it is advisable to hold 5% to 10% of one’s portfolio in form of physical gold.