One-Fund Wonder or Financial Blunder?

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Should you invest all your money in one mutual fund for all your financial needs? Although the convenience is irresistible, experts advise caution.

Core Insight

One mutual fund, like a target-date or a balanced fund, can offer diversification and convenience to beginning investors.

Though it may not be appropriate to the various timelines, risk tolerances, and return needs of various goals.

Strategic Breakdown

Short-term goals (e.g., vacation, holiday) need low-risk funds for debt.

Long-term goals (like retirement) benefit from equity-heavy funds.

Having one fund exposes you to one fund manager's style or sector bias.

Smart Alternatives

Consider goal-oriented investing with distinct funds allocated to every goal.

Deploy SIPs of differing mandates to track progress and rebalance accordingly.

Bottom Line One fund may simplify, but not many will suffice. Diversification by time horizon and fund type is still necessary.

Sources: The Balance, Financial Express, Value Research Online, Reddit India Investing Forum