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§ Tools / Series 03 · Personal finance

FD vs stock market returns

Park your money in a Fixed Deposit, or put it in the market. Which produces more, and what equity return would you need just to match the FD? Closed-form math on both sides, lot-aware equity tax in monthly mode, and the inflation deflator surfaced as a first-class output. No "stocks always win" copy. The tool reports what your assumptions produce.

§ Risk asymmetry

Equity returns are assumptions, not guarantees. FD/RD has issuer risk, premature-withdrawal penalties, and deposit-insurance caps (FDIC, DICGC, etc.). Risk is not the same as zero. The calculator surfaces both with their own caveats and never pretends one is risk-free.

2
Modes
3
Bases
Lot-aware
Equity tax
5×5
Sensitivity
v1
Methodology
Investment mode
01Investment
02FD side
03Equity side
04Advanced · taxation
Taxation is off. Gross and real comparisons are still available. Turn it on to model lot-aware equity tax (monthly mode) and FD tax timing.
Difference · Gross
+$1,659
Equity wins · Equity $8,733 vs. FD $7,074
Break-even equity return
7.19%
Your assumption (12%) is above break-even. Equity wins.
FD maturity value
$7,074
gross · FD
Equity future value
$8,733
gross · Equity
Difference (gross)
+$1,659
Equity − FD
Break-even equity return
7.19%
to match FD
Total invested
$5,000
one-time
FD effective annual
7.186%
vs. typed 7% nominal
§ Side-by-side · Gross basis
5 years · Before tax & inflation
Total invested
$5,000
FD value
$7,074
Equity value
$8,733
Gross$7,074 vs $8,733
Real$5,814 vs $7,178
§ Year-by-year
FD (gold) vs Equity (navy)
Y0Y1Y2Y3Y4Y5
FD curve Equity curve
§ Scenarios

What if equity returns disappoint, or surprise to the upside?

Bear
$7,623
Equity return -3pp → 9%
vs FD: +$549
Base
$8,733
Equity return +0pp → 12%
vs FD: +$1,659
Bull
$9,970
Equity return +3pp → 15%
vs FD: +$2,896
§ Sensitivity

Equity − FD difference, by FD rate × equity return

5×5 grid · positive (green) = Equity wins · negative (red) = FD wins
Equity return →
↓ FD rate8.0%10.0%12.0%14.0%16.0%
5.00%+$869+$1,569+$2,323+$3,133+$4,001
6.00%+$545+$1,245+$1,999+$2,809+$3,677
7.00%+$205+$906+$1,659+$2,469+$3,338
8.00%$-151+$550+$1,304+$2,113+$2,982
9.00%$-524+$177+$931+$1,740+$2,609
§ Formula trace
every output, derived
  1. fdEffectiveAnnual = 7.1859% (from 7% nominal, quarterly)
  2. equityEffectiveAnnual = 11.8000% (base 12% − fee 0.2%)
  3. fdGross = amount × (1 + ratePerPeriod)^(n×years) = 7073.89
  4. equityGross = amount × (1 + 11.8000%)^5 = 8733.31
  5. inflationDeflator = (1 + 4%)^5 = 1.2167
  6. breakEvenEquityReturn = (fdGross / amount)^(1/years) − 1 = 7.1859%
§ Input audit
no input silently ignored
amountused
basisused
currencyused
dividendYieldPctunused
equityLongTaxPctunused
equityReturnPctused
equityReturnTypeused
equityShortTaxPctunused
expenseRatioPctused
fdCompoundingused
fdRatePctused
fdRateTypeused
fdTaxRatePctunused
fdTaxTimingunused
inflationPctused
longTermExemptionunused
longTermMonthsunused
modeused
taxOnused
timingunused
unitused
yearsused
§ Single-product calculators
Fixed deposit calculator →Recurring deposit calculator →SIP calculator →Compound interest calculator →
§ Same engine, headlessly

Rate normalization, lot-aware equity tax, inflation deflator, scenarios, sensitivity. All reachable as a stateless REST endpoint and as MCP tools.

POST/api/v1/financial-calculators/fd-vs-equity/calculate
GET/api/v1/financial-calculators/fd-vs-equity/schema
GET/api/v1/financial-calculators/fd-vs-equity/defaults
GET/api/v1/financial-calculators/fd-vs-equity/equity-defaults?symbol=SPY&lookback_years=5 · professional+
GET/api/v1/financial-calculators/fd-vs-equity/model-defaults?region=US&profile=balanced · professional+
MCP toolscalculate_fd_vs_equity_returnscalculate_fd_vs_sipget_fd_vs_equity_defaultsget_fd_vs_equity_market_defaultsexplain_fd_vs_equity_formula
methodology_version = financial-calculators.v1 · canonical = /en/tools/fd-vs-stock-market-returns-calculator
§ FAQ

Four things worth knowing

Q01What does the break-even number actually mean?+
It's the equity return your assumptions would need to produce just to match what the FD/RD delivers under your other inputs. If your assumed return is below it, the FD wins under your own numbers. It is the most decision-relevant single output in the panel. It converts "stocks vs FD" into a yes/no question against a single hurdle rate.
Q02Why does the FD effective rate differ from the rate I typed?+
Indian and many global banks quote FD rates as nominal APR with quarterly compounding. 7% nominal quarterly compounds to 7.186% effective annual; 7% monthly compounds to 7.229% effective. The tool exposes both numbers so the comparison is apples-to-apples. Most free calculators hide the conversion entirely.
Q03Is the equity tax really lot-aware in monthly mode?+
Yes. Each month's SIP contribution is tracked as a separate lot with its own holding period. When the program ends, lots with holding ≥ long-term threshold get the long-term rate (after the once-per-run exemption); shorter-held lots get the short-term rate. This matters a lot for short SIPs in jurisdictions with a 12-month long-term threshold. The first 12 monthly lots may not qualify.
Q04Why no built-in "stocks always win" copy?+
Because the math doesn't always say that. Flip the comparison basis to real (post-tax and post-inflation) in a high-rate / high-inflation country and the FD can win. The tool reports what your assumptions produce (including a sensitivity grid and scenarios) and leaves the decision to you. The risk asymmetry (equity volatility, FD insurance caps, issuer risk) is in the notes, not buried.