If i have huge amount of SIP in Nifty Index fund, Is it better to split it into funds from different company? or keep it under single fund ?
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I had the same confusion, but then someone advised that as I was invested in SBI AMC, it was ok. I also did one thing. Once I achieved a peak (for myself), on SBI Nifty 50 ETF, my incremental money is going to SBi Nifty 50 Equal weighted ETF (this is a new ETF, DSP has a similar one - but my preference is to SBI). Same stocks but weightage different as I thought the tail of SBI nifty 50 ETF had a small weightage which basically does nothing.
If you have already invested, do not close and move it as you will be paying taxes, benefit will be marginal. You can think of putting incremental money in any other index fund of your choice.
++ Do we need to diversify while choosing Index Funds as well?
In my view there is no need.
However you should be owning different types of index funds
I have nifty 50 etf plus
Nifty next 50 etf.
This basically covers 100 companies and dont need more
But when u look at weightage in nifty 50, almost 20 stocks are below 1 percent. What benefit do we get nothing
So i started nifty 50 equal weighted etf so that the tail end of nifty gets some more weights.
Whether this is diversification i dont know. But too much diversification will not make any money. Its good optically to be invested but weightage is minisule
Check nasdaq 100. After the first 15 odd stocks the weightage is pathetic.
These are my personal views and could be wrong
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