Mutual Fund Portfolio Management: Due to abundance of investment options, investors sometimes have to face problems. Investors are not able to take decisions regarding all these. If you have also invested in different mutual funds under SIP, then you can understand this problem.
Due to good funds, investors invest small amounts in different funds. This makes his portfolio appear scattered. The biggest problem arises when you have to select some of these funds and leave the rest. According to the report of ETWealth, expert Ravi Kumar has told how to deal with this problem. He has given information on how you can manage your portfolio.
5 to 6 funds are enough
Ravi Kumar has informed that, if an investor regularly monitors his funds and has an understanding of funds, then only 5 to 6 mutual funds are enough for such investors. He told that the role of every fund is different, hence one should avoid investing in similar companies. Different funds should always be selected on the advice of market experts. So that there is diversity in the portfolio.
Keep these things in mind while managing funds
Many investors believe that the more funds there are, the better the diversification, but this is not necessary. According to Ravi, the real thing is how different the funds you choose are from each other and how balanced their investment style is. If you have invested all your money in the same type of shares, then the number of funds and companies may increase, but you will not get much benefit by staying in the same segment.
Giving further information, Ravi Kumar said that every equity fund has its own style. Some focus on growth stocks, while others focus on value or quality stocks. Therefore, it is important to include such funds in the portfolio which have different investment strategies, so that balance is maintained even in the ups and downs of the market.
Disclaimer: (The information provided here is being given for information only. It is important to mention here that investment in the market is subject to market risks. Always take expert advice before investing money as an investor. ABPLive.com never advises anyone to invest money here.)
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