How many funds in a portfolio?

How many funds should one keep in his/her portfolio?
- Mukesh Kumar

We believe that four or five mutual fund schemes are enough to provide you diversification. Investing in too many schemes may not actually provide you extra diversification. This is because these funds may be investing in similar set of stocks. So when you are adding one scheme after the other for the sake of diversification, you may be actually accumulating schemes with more or less the same investments. Too many funds also make it difficult to track the performance of your investments.

You can also go through this:How many funds should I invest for the right diversification?

This article was originally published on November 23, 2015.