Convention wisdom says that you should not put all your eggs in one basket. Your investment portfolio should be well-diversified, but holding too many funds means there’s a risk some may overlap. Diversification saves you from poor performance of a set of investments. If a particular company or sector does worse than the markets in general, then having only a small part of your money exposed to it helps. An average investor may not need more than two or three mutual fund schemes to meet his/her various financial goals. However, those with large investments may invest in a maximum of up to six schemes. Investing in too many schemes may make tracking them difficult.
Tuesday, August 21, 2018
WHAT IS THE IDEAL NUMBER OF MUTUAL FUND SCHEMES ONE SHOULD HAVE IN HIS/HER PORTFOLIO?
Convention wisdom says that you should not put all your eggs in one basket. Your investment portfolio should be well-diversified, but holding too many funds means there’s a risk some may overlap. Diversification saves you from poor performance of a set of investments. If a particular company or sector does worse than the markets in general, then having only a small part of your money exposed to it helps. An average investor may not need more than two or three mutual fund schemes to meet his/her various financial goals. However, those with large investments may invest in a maximum of up to six schemes. Investing in too many schemes may make tracking them difficult.
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