Edelweiss CEO Radhika Gupta has an index fund for her baby. Here's why

Edelweiss MD and CEO Radhika Gupta recently revealed that she has an index fund for her 10-month-old baby Rémy Gupta Moniz. During an interview with The Mint, Gupta said that her son already has a SIP (systematic investment plan) in index funds.

"He already has a SIP in large and midcap index funds," she told the publication. Then, taking to Twitter, Gupta explained why she, the head of an asset management company with largely active funds opted for passive ones for her son.

"The reason to own an index fund for my son is that he has an 18-year horizon, and over 18 years, I truly don’t know how funds or markets will evolve. A broad-based fund that gives exposure to Indian economic growth, is all we need. We can top it up later as time passes," Radhika Gupta said adding that her own portfolio is 100 percent active funds.

Gupta then clarified she was not aiming for a debate on which is the better fund. "My story is not a case for active vs passive at all, but rather a proof that: 1) both can co-exist for different purposes, there is no versus here, and 2) personal finance is personal first, the right answer can be different for two people even in one family."

The Edelweiss MD and CEO added, "Finally those who have been following this over years would notice that there isn’t much change in funds and allocations. That’s what I believe -- a decent asset allocation, SIPs, and good funds that just compound do the trick for most of us."