Investment experts Prableen Bajpai and Nasser Salim shared strategies for selecting mutual funds and commodity funds during a recent CNBC TV18 discussion [1].
Proper portfolio diversification is critical for retail investors attempting to mitigate risk while pursuing growth in volatile markets. As investors navigate various asset classes, selecting the correct ratio of equity to debt can determine long-term financial stability.
Bajpai, the founder of FinFix Research and Analytics, and Salim, managing director of Flexi Capital, said they answered viewer questions regarding Systematic Investment Plans (SIPs) and fund categories [1]. The session focused on helping investors build balanced portfolios that can withstand market swings through expert guidance on mutual fund selection [1].
Diversification does not require an excessive number of holdings to be effective. Experts said that three to six mutual funds can provide sufficient diversification when an investor mixes large-cap, mid-cap, small-cap, and debt funds [2]. This streamlined approach prevents over-diversification, which can dilute potential returns.
While individual retail strategies vary, the scale of professional management remains vast. For example, First Pacific Advisors managed $32 billion in assets under management as of Dec. 31, 2025 [3].
The discussion emphasized the importance of matching fund categories to specific financial goals. By combining different market-cap funds with debt instruments, investors can create a safety net that balances high-growth potential with capital preservation [1].
“Three to six mutual funds can provide sufficient diversification.”
The emphasis on a limited number of funds—specifically three to six—suggests a shift toward 'core and satellite' investing. By focusing on a few high-conviction funds across different market caps rather than dozens of overlapping products, investors can reduce management fees and tracking errors while maintaining a diversified risk profile.
