You always advice to diversify across the market. In a market like this, should we invest in just a mid-cap fund or should we only use multi-cap funds that are spread across the market?
-Sampath R
There are many ways to diversify your investments. You can choose from the range of diversified funds or choose funds which focus on different segments of the markets. The method you choose depends on your attitude to a bad phase of the market. If you are among those who would lose sleep over daily movements, you should stick to diversified funds from Value Research's category of large & mid-cap and Multi-cap equity funds. This is a low maintenance approach to your fund investments. The other way will be to choose high performance funds with narrow focus than these. Such funds tend to be more cyclical and require a proactive monitoring and review.
This article was originally published on December 19, 2013.
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