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Where should an experienced investor invest Rs 35 lakh?

Dhirendra Kumar explains how widely-spread should be your portfolio

I am a risk-taker and have been investing for the last 17 years. Now I have Rs 35 lakh to invest, which I wouldn't need for another eight to ten years. I plan to deploy it in two flexi caps, two mid-caps, two-focused funds and a Nasdaq fund. What's your opinion on the same?
- Jhumki

If you plan to invest Rs 35 lakh in seven funds, it means investing Rs 5 lakh in each. And you will have to keep track of these seven funds. I would say reduce the number of funds to maybe five, i.e., about 20 per cent allocation to each fund and work hard to choose the best of the lot.

Now, there is a reason why one should have a meaningful allocation to a single fund. If one has a very small amount of money spread across many funds, they may not be as interested. On the contrary, the moment one has a meaningful amount of money in one fund, one worries about it, keeps an eye on that and may take some action as and when required. Otherwise, one remains complacent about it.

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