Good investing outcomes come from doing few boring things well: Nithin Kamath

Building long-term wealth does not require constantly chasing hot stocks or perfectly timing the market. Instead, investors should focus on a few key principles, according to Zerodha co-founder Nithin Kamath. He noted that while successful investing may sound simple, many investors overcomplicate it by trying to predict markets or choosing from thousands of options.

In a post on X, Kamath said good investing outcomes come from doing “a few boring things well,” adding that disciplined, low-touch investing, rather than frequent decision-making—can help investors achieve their financial goals.

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Kamath posted that, “Good investing outcomes come from doing a few boring things well. For most people, investing boils down to a handful of things: decide on the right asset allocation for your financial goals and time horizon, stick to low-cost index funds or ETFs instead of trying to pick stocks, invest regularly through market ups and downs, increase investments as income grows, periodically rebalance your portfolio, and stay invested. That’s really it.”


According to Kamath, most investors do not need complex strategies to build wealth. He said successful investing comes down to a handful of principles: choosing the right asset allocation based on financial goals and investment horizon, investing in low-cost index funds or ETFs instead of picking individual stocks, investing regularly regardless of market conditions, increasing investments as income grows, periodically rebalancing the portfolio, and staying invested long term. “That’s really it,” he said.

While the framework appears simple, Kamath noted that execution is often challenging.

Investors frequently grapple with questions such as how to allocate across equity, debt and gold, which funds to choose, how often to rebalance, and whether allocations should change as goals near completion. He said these are valid concerns but rarely have simple answers.

The complexity is amplified by the sheer number of mutual funds and ETFs available. Even investors committed to low-cost index strategies can find the universe of options overwhelming, he added.

Kamath said this often deters people from investing, pushing them toward fixed deposits or insurance products despite potentially better long-term alternatives.

He also pointed to lifecycle funds, or target-date funds used in global markets, which automatically adjust asset allocation based on an investor’s goal and time horizon, reducing the need for active portfolio management.

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Investors simply choose a fund aligned with the timeline of their financial goal, while the fund handles portfolio construction, rebalancing, and gradually reduces equity exposure as the target date approaches.

“The farther away you are from your goal, the more risk you can take. The closer you get, the more important it becomes to preserve capital,” Kamath said.

He noted that someone nearing retirement, for instance, may not want their entire corpus exposed to equities due to the risk of sharp short-term volatility.

Kamath said lifecycle funds were not available in India until recently. Following SEBI’s introduction of the category, Zerodha AMC has become the first asset management company to launch such funds in the country.

He added that the underlying portfolio has been designed to remain simple and low-cost. The equity portion is invested in the Zerodha Nifty LargeMid 250 Index Fund, offering exposure to India’s top 250 large- and mid-cap stocks.

The debt component is allocated to government securities, while gold and silver are included for diversification. The portfolio also carries an arbitrage component to enhance tax efficiency.

Kamath described lifecycle funds as a low-maintenance option for investors seeking a simple way to meet long-term financial goals. He added that new fund offers (NFOs) for Zerodha AMC’s lifecycle funds are currently open.

The funds currently open for subscription are Zerodha Life Cycle Fund 2036 and Zerodha Life Cycle Fund 2041, while Zerodha Life Cycle Fund 2046 and Zerodha Life Cycle Fund 2051 are in the pipeline.

(Disclaimer: Recommendations, suggestions, views and opinions expressed by experts are their own and do not represent the views of The Economic Times)

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