DON'T PUT ALL YOUR EGGS IN ONE BASKET
DIVERSIFY
YOUR INVESTMENTS
DIVERSIFIED FUND
In diversified equity funds, there are schemes which diversify among sectors on the basis of the market capitalization of stocks, and the schemes invest across diverse sectors.
WHAT IS A DIVERSIFIED FUND?
A Diversified Equity fund is a category of mutual funds which invests in stocks of companies across multiple sectors and sizes. A diversified fund ensures that the poor performance of a particular sector or stock does not impact the entire portfolio.
A Fund can diversify by investing in:
► Multiple Sectors: A Diversified Fund can invest in various sectors like banking, chemicals, pharmaceuticals, FMCG, automobiles, etc.
► Multiple sizes: A fund can also diversify on the basis of market capitalization, viz large caps having huge market capitalization, mid caps with medium capitalizations or small caps, with small market capitalizations.
A diversified equity fund invests in companies regardless of size and sector. It diversifies investments across the stock market in a bid to maximize gains for investors.
WHY SHOULD YOU INVEST IN A DIVERSIFIED FUND?
Since the portfolio of a diversified equity scheme invests across multiple sectors, the poor performance of one sector is offset by the superior returns generated by other sectors.
Since Diversified schemes have the option to invest in multiple sectors, the fund manager has the discretion of shifting funds from non performing sectors to performing ones.
PERFORMANCE
TENURE: Over the years, average of diversified equity funds has been able to outperform the benchmark S&P BSE Sensex.
Disclaimer: The figures/projections are for illustrative purposes only. The situations/results may or may not materialize in future. Mutual Fund investments are subject to market risk, Read all scheme related documents carefully. Past performance may or may not be repeated in future.
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