Unlocking Your First Crore: Kailash Kulkarni Shared Insights on Mutual Fund Investing in India

In a candid chat with finance journalist Vivek Law on the Simple Hai! show, Kailash Kulkarni, CEO of HSBC Mutual Fund, shared deep insights on the rising wave of mutual fund investors in India. Kulkarni revealed a big milestone: “In 2024, nearly 9 million individual investors entered mutual funds for the first time.” This shows how Indian households are slowly shifting from gold and real estate towards financial products. For first-time investors, his advice was simple: “If you have a 5-year horizon, start with index funds. Don’t worry about timing the market, just stay invested.”

Why Trusted Advice Still Matters

While technology is changing the industry, Kulkarni admitted that India still lacks a strong pool of qualified financial advisors. He explained that investing without guidance can be risky: “Just like you won’t build a house without an architect, don’t invest without advice.” He even shared a personal example about his niece, who learned the importance of understanding her risk profile after relying only on AI-driven recommendations.

Mutual Funds Beyond Equity

A common myth in India is that mutual funds mean equity and high risk. Kulkarni clarified: “There are hybrid funds, fixed-income funds, and equity savings products with just 15–20% equity. New investors get confused with jargon, which is why advice is so important.”

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AI in Mutual Funds: Friend, Not Enemy

Kulkarni believes artificial intelligence will help, not disrupt, the industry. According to him, AI can analyse large amounts of data and help identify investor preferences, such as choosing between large-cap, hybrid, or small-cap funds. With SEBI’s stronger regulations and better data transparency, he said AI can now make investor protection and customisation smarter.

Investor Behaviour: Old Habits, New Awareness

When asked if younger investors are more impatient, Kulkarni noted that some habits, like trying to time the market, still remain. However, he also pointed out positive change: “People who stayed invested for 10 years have seen huge growth. They are now brand ambassadors for mutual funds.” Education, real-life success stories, and the pandemic’s impact have made investors value liquidity and discipline.

The Shift from Real Estate to Financial Assets

Traditionally, Indians preferred real estate and gold. But the pandemic-induced liquidity crisis showed investors the importance of financial flexibility. Kulkarni highlighted a new trend: many investors now choose to take a home loan at 7-8% interest instead of breaking mutual fund investments, because mutual funds can potentially deliver 12% or more returns in the long term.

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Reaching Gen Z and Millennials

The younger generation, Kulkarni observed, treats investing like ordering food online—fast and app-driven. He warned that the industry needs more creative communication strategies to connect with this audience, instead of relying on the same methods used for the last 15 years.

Asset Allocation: The Secret to Wealth Creation

Kulkarni stressed one golden rule: “90% of returns come from asset allocation, not market timing.” He suggested that investors keep 80% of their portfolio stable and diversified, while 20% can be used for high-risk investments. That way, even if the risky bets fail, financial goals stay safe.

Personal Lessons That Shaped Him

On a personal note, Kulkarni credited his late father for teaching him independence and resilience early in life. His guiding principle remains: “Never do something half-heartedly.”

The Road Ahead: Big Opportunities, Bigger Challenges

Kulkarni predicts massive growth: “From 50 million mutual fund investors today, we will reach 140 million in the next 3–4 years.” However, he warned that building a strong advisor ecosystem is critical for supporting this growth. He also noted that the distribution business is maturing, with many advisors now handling assets worth 50–300 crores, and even their children entering the profession.

Keep It Simple

Kulkarni’s advice to investors is straightforward: focus on asset allocation, stay invested long-term, and don’t complicate the process. As he summed up: “If we keep it simple, investing becomes easier for everyone.”