I am 45 years old and I have long term goals. I have invested in the following Mutual Funds (MFs) between Aug 2020 and Jul 2022- Axis Long Term Equity Fund, SBI Focused Equity Fund, Parag Parekh Flexi Cap Fund, ICICI Prudential ESG Fund, Kotak Small Cap Fund, Mirae Asset Midcap Fund , Tata Flexi Cap Fund, SBI Focused Equity Fund, Kotak Equity Opportunities Fund, Mirae Asset Great Consumer Fund, ICICI Prudential Equity & Debt Fund, Tata Multi Asset Opportunities Fund, Axis Small Cap Fund, SBI Small Cap Fund, Kotak Emerging Equity Fund, HDFC Large & Mid Cap Fund, and Invesco India Growth Opportunities Fund. Is it good for my portfolio?
Name withheld on request
You may consider streamlining your portfolio as you have invested in 17 MF schemes. Over-diversification can sometimes be counter-productive and can lead to over-leveraging at the portfolio level. Ideally, 6 to 8 funds are sufficient to build a good long term portfolio.
You can revisit your strategy of investing in funds for a few months and then adding new funds.
This may lead to many more funds in your portfolio which may not help you in getting the best results and may also add complications in managing the portfolio. You have good funds in your current portfolio. You can continue investing in Parag Parikh Flexi Cap, Kotak Equity Opportunities, Mirae Mid Cap, SBI Small Cap, Kotak Emerging Equity and HDFC Large & Mid Cap Fund.
For other funds, you can review their performance and if required switch from underperforming funds to existing funds, else you can get capital gains on redemption from the funds.
The most important thing is that you have good funds in your portfolio which can help you achieve your long term goals and you can continue the good work of investing regularly in mutual funds.
Harshad Chetanwala is the co-founder of MyWealthGrowth.com.
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