I have been investing in 20 mutual funds. Should I trim my portfolio?

I am 31 years old. I am an NRI. My plan is to come back to India in another 10 years. I may or may not work after that. I need around Rs 50,000 per month.My plan is to continue to invest through SIP. I am currently investing Rs 1 lakh per month (Rs 5,000 in 20 funds). I am planning to increase it by another Rs 50,000 from January. These mutual funds have accumulated Rs 50 lakh in the past five years (invested Rs 36 lakh).

My advisor has told me that these funds are enough to reach my goal of Rs 5 crore in 10 years. Even though I have told him to reduce the funds to avoid over diversification. Do I need to take a second opinion since I feel the advisor has allotted funds which gives him more commissions at the same time I feel the returns are not bad also.

Aditya Birla Sun Life Equity Advantage Fund
Aditya Birla Sun Life Focused Equity Fund
Canara Robeco Flexi Cap Fund
DSP Flexi Cap Fund
Edelweiss Flexi Cap Fund
Edelweiss Recently Listed IPO Fund
Franklin India Flexi Cap Fund
HDFC Hybrid Equity Fund -Regular Plan
ICICI Prudential Banking & Finanacial Service Fund (G)
ICICI Prudential Business Cycle Fund
ICICI Prudential Equity & Debt Fund(G)
Invesco India Smallcap Fund (G)
Nippon India Balanced Advantage Fund (G)
Nippon India Large Cap Fund
Nippon India Pharma Fund
Sundaram Large &Mid Cap Fund (G)
Sundaram Small Cap Fund(G)
Tata Balanced Advantage Fund (G)
UTI Flexi Cap Fund
UTI Nifty 50 Index Fund
-–Devadas

We do not know the details of your conversation with your advisor. We believe 20 schemes are really too much. It is difficult to keep track of their performance. There is also the issue of duplication of portfolios of the schemes. Diversification is not about investing a small amount of money in too many schemes. It is about spreading your investment across different asset classes to reduce risk and maximize returns.

We typically ask our readers to choose schemes based on their risk profile and investment horizon. An average investor does not need to invest in more than four schemes, including a tax saving scheme.


You should hire a fee-only mutual fund advisor or financial planner. A focused portfolio will help you to maximize your returns.