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Reader’s question: How to divide the monthly investment in mutual funds if the amount exceeds Rs 50,000? - Apoorv Gaurav
There is no ideal way to split a monthly investment of more than Rs 50,000. The right approach depends on your investment horizon, risk appetite and the level of complexity you are comfortable with.
However, simplicity works best for most investors.
If you are investing for long-term goals and want an uncomplicated portfolio, two well-managed flexi-cap or multi-cap funds can be enough. These funds invest across companies of different sizes and market segments, offering diversification within a single category.
Investors with a horizon of at least seven years and a higher tolerance for volatility can consider adding one or two small-cap funds to seek higher growth potential. However, small-cap funds can witness sharp ups and downs, so they should form only a limited part of the portfolio.
The key is not to spread money across too many schemes. Even if you are investing Rs 50,000 or more every month, a portfolio of three to four equity funds is usually sufficient. Having too many funds often creates overlap and makes portfolio monitoring difficult without meaningfully improving diversification.
Also read: Is buying on dips actually better than a monthly SIP?
This article was originally published on March 11, 2022, and last updated on June 26, 2026.
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