The Mutual Fund Show: What's The Right Number Of Funds In A Portfolio?

How many mutual funds are too many? What makes an optimal portfolio? These are questions that investors rack their brains about. Diversification ensures you get the best returns, or so goes common advice.

Before you begin decluttering your portfolio, Shah suggested reviewing the performance of the funds in comparison with the benchmark. Additionally, consider the tax implications of the fund, he said.

If you're revamping your portfolio and have too many funds, make sure to consult an advisor and keep in mind the taxation impact of exiting old funds, Pagdiwala said.