Latest news with #Finfluencers
Mint
18 hours ago
- Business
- Mint
The silent killer in your portfolio: Why one stock could wreck it all
When equity markets rally, portfolios with concentrated bets often look like winners. Investors in stocks like Gensol Engineering or Mazagon Dock in 2023 may have flaunted triple-digit returns. But beneath that temporary high lies a quiet but dangerous threat: concentration risk. Concentration risk refers to excessive exposure to a single stock, sector, or strategy. While it can magnify gains, it also amplifies losses when things go wrong. In a country where stock investing is now mainstream and mutual funds manage over ₹55 lakh crore (as of April 2025), this risk often goes unnoticed—until the tide turns. Also read: Devina Mehra: Diversified or concentrated portfolio? It's an easy choice The temptation of overconfidence In recent years, retail investors in India have been shifting away from diversified mutual funds and toward direct stock picking. Fuelled by Finfluencers, demat apps, and FOMO, many investors now chase recent winners highlighted under 'top gainers in 1 year" filters. The pattern is familiar: someone sees a stock that has returned 300% over 18 months and bets big, assuming the past will repeat. But markets are rarely so kind. The Gensol lesson Take Gensol Engineering. The stock soared over 200% in 2023. But by early 2024, after reports of financial irregularities and broader corrections, it plunged nearly 30% in just weeks. For those who had 40–50% of their portfolio in Gensol, the damage was severe—even though broader indices were stable. Data speaks: The price of concentration According to the CFA Institute, a well-diversified portfolio needs at least 20–25 uncorrelated stocks. In India, mutual funds typically hold 40–60 stocks. Yet many DIY investors own just 5–8 stocks—often clustered around themes like capital goods, defence, or small caps. The difference isn't theoretical—it's the line between staying invested and panic selling during volatility. Diversification vs. diworsification Many investors argue that too much diversification dilutes returns. It's true—diversification doesn't guarantee the highest return, but it protects against catastrophic loss. Also read: Diversification isn't about how many stocks or funds you own—it's about which ones Let's say you own five stocks. If one stock crashes 80%, and it made up 40% of your portfolio, your entire wealth drops by 32%—even if the rest stay flat. A diversified fund with the same stock at 3% allocation would suffer less than 2.5% impact. Think of diversification like a cricket team. You might have Virat Kohli, but if the other 10 are debutants, your tournament odds shrink. A steady, well-balanced lineup gives you better consistency—even if a star underperforms. Mutual Funds: The diversification you forgot In chasing alpha, many investors have abandoned mutual funds—especially actively managed ones. But mutual funds offer built-in benefits: diversification, professional management, risk-adjusted returns, and regulatory safeguards. Some points to consider: Instead of ditching mutual funds completely, consider a blend. For instance, a 70-30 split between diversified funds and direct equity can offer growth with a cushion. 10/10/10 rule for safer investing To control concentration risk, follow the 10/10/10 rule: Review your SIPs, holdings, and direct investments every six months. If one idea has grown disproportionately, consider trimming it. Final thought In investing, silent risks are often deadlier than visible ones. Concentration risk doesn't show up in daily NAVs or dashboards—it shows up in sleepless nights during market corrections. A portfolio should not just perform in bull runs; it should survive the bear phases. As markets evolve and choices multiply, managing risk is not just about avoiding losses—it's about staying in the game. And for that, diversification isn't optional. It's essential. Also read: Unlocking global markets: How Indian investors can diversify with portfolio management services Viral Bhatt, founder, Money Mantra— a personal finance consultancy
UAE Moments
4 days ago
- Business
- UAE Moments
Creating Content in UAE? Dh1M Fine If You're Not Registered
From May 29, 2025, a new UAE media law requires individuals and organisations to get a permit or licence from the UAE Media Council (or other relevant authorities) before producing or distributing any media. This includes: Broadcasting on radio, TV, and on-demand platforms Electronic and digital media , such as websites and social media Film screenings , cinema, and arts content Social media advertising by individuals Foreign and local publications , including newspapers, magazines, and books Street and aerial photography for media use Video games and gaming content Operating foreign and local media offices Attempting any of these media activities without a licence starts with a Dh10,000 fine, doubling to Dh40,000 for repeat offences. Read More: First 10 Licensed Finfluencers in UAE Announced Heavy Penalties for Serious Infractions Violating the new law can cost more than just unpaid fines. Offending actions include: Spreading false or misleading news Disrespecting the UAE government or its ruling system Conducting media work without a licence Violators now face penalties of up to Dh1 million for their first offence—and repeat violations can rise even higher, reflecting the UAE's focus on maintaining trustworthy, value-driven media. Why It Matters Officials say the law promotes ethical journalism and encouragement for media to follow clear guidelines on hate speech, privacy, cultural respect, and national unity . It also marks a significant shift from decades-old regulations, updating how the UAE manages all forms of media. Read More: UAE Named Social Media Capital of the World What Creators Should Know All media work , from a personal blog or social media account used for ads to a foreign publication, must be licensed . Hard penalties start with Dh10,000 and can reach Dh1 million for defamation, misinformation, or disrespect to national symbols. Creators, agencies, and production companies operating in or targeting UAE audiences must now register with the UAE Media Council and meet its content and licensing standards. This law significantly shifts how content creators, influencers, and media organisations operate in the UAE. The rules are now tighter, the fines are stiffer, and accountability is clear. For anyone creating content—big or small—in the UAE, this is a wake-up call: get licensed, play by the rules, and keep it respectful.
