Nykaa, a finfluencer and the business of selling fear

#Nykaa received a lot of unwarranted attention recently, all thanks to an unsolicited post by a #Finfluencer. As the post went viral, many more finfluencers joined the bandwagon!
As usual, the goal was to sell fear, because fear sells better than facts. And that’s why simple, effective strategies like investing in #MutualFunds via #SIPs often get unfairly sidelined.

The Finfluencer claimed:
“Nykaa’s stock never crossed ₹400, and MFs that still hold it are in the loss.”
But here’s the problem with that argument: mutual funds don’t operate like this.
- Mutual Funds typically invest in IPOs and continue to manage that investment based on market conditions, inflows, and opportunities.
- They don’t hold all shares at one price point. Fund managers may buy more if conviction increases, or exit partially or fully based on evolving fundamentals.
- They may even buy and sell within the same month, meaning that those trades won’t reflect in monthly holding disclosures.

More importantly, stock prices never move linearly. There might have been a fund manager who bought Nykaa at its 52-week low and is currently enjoying solid gains, but you simply won’t know that from one snapshot.
So yes, some funds may be in loss on Nykaa, but others could be in profit. And that’s precisely why judging a fund’s performance based on a single stock is misleading.

Let’s cut through the noise.
Sometimes, the most boring investment plans, like SIPs in diversified mutual funds, help grow your wealth more consistently than any viral market tip.