Think more mutual funds mean better diversification? Here’s why your portfolio may still be concentrated
Many mutual fund investors mistakenly believe that adding more schemes leads to better diversification. Experts, including Rhishabh Garg, warn that overlapping holdings can keep portfolios concentrated despite the number of funds. An audit revealed that 16% of 13,600 portfolios underperformed the Nifty 50, highlighting the need for genuine diversification strategies beyond mere quantity.