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Mutual Fund Corner: Experts discuss portfolio diversification and how to gift MF units

In this episode of ‘Mutual Fund Corner’, CNBC-TV18 spoke to Vishal Kapoor, CEO of IDFC AMC, and Manoj Nagpal, MD & CEO of Outlook Asia Capital, who answered the viewers’ mutual fund queries. Vishal Kapoor will talk about portfolio diversification -- what is it? Why is it important? Why do you need it and how to keep a track of it?

In this episode of ‘Mutual Fund Corner’, CNBC-TV18 spoke to Vishal Kapoor, CEO of IDFC AMC, and Manoj Nagpal, MD & CEO of Outlook Asia Capital, who answered the viewers’ mutual fund queries.
Vishal Kapoor will talk about portfolio diversification -- what is it? Why is it important? Why do you need it and how to keep a track of it?
Kapoor said, “Diversification as a concept has really been around since the time of the old adage, we have all heard, which is ‘don't keep all your eggs in one basket’. So I think it is a concept well understood, and accepted. But there is science and there is some maths and statistics behind this.”
“There have been several studies and models developed, which really target one thing in specific, which is to try and build what is called an efficient model or efficient frontier of assets. The expectation there is that you are trying to look for the best combination of return for a level of risk, or vice versa.”
Also, Manoj Nagpal will weigh in on how you gift units of mutual fund schemes.
Nagpal said, “SEBI Act, clearly states that mutual fund units can be transferred by operation of law or by an act of parties, which clearly means that transfer of units of Mutual Funds is possible under their exquisite act that are there and hence since gifting is just a transfer from one person to another and mostly it is out of love and consideration or to donate or to create a legacy.”
Watch accompanying video for more.