How many funds should I hold in my investment portfolio?

It's a good question, and it depends what you have. If you have a multi-asset fundA term used to describe a product or portfolio that contains more than one type of asset class - e.g. shares and property. or a global index fundA fund that aims to match the performance of a global stock market index by holding shares in companies from around the world. These funds typically track indices like the MSCI World Index or FTSE All-World Index, giving investors exposure to thousands of companies across developed markets (and sometimes emerging markets too). Because they're passively managed and simply follow the index, global tracker funds have low fees compared to actively managed funds. They're a popular choice for long-term investors wanting broad international diversification without needing to pick individual countries or companies. — a global shares ETF, for example — then one of these pick-and-mix funds can provide enough diversification The process of spreading your investment portfolio across different asset classes, such as partially in shares and partially in bonds, in order to reduce risk.for anyone. Most will have over 1,000 sharesA unit of ownership in a company. Companies divide their ownership into shares and investors can purchase these to become owners of a tiny part of it. They're also called 'stocks' or 'equities'. in them, which is plenty.

If, however, you are cherry-picking a handful of active funds — maybe some bond funds, some regional share funds, and possibly some sector-based funds such as tech, defence, or healthcare — then I'd suggest somewhere between 10 and 15 is reasonable. Those with higher balances and more complex affairs might head nearer 20. But too many more and it starts to get unwieldy. Some of your choices will also undo choices made by other active fund managers — one might underweight BP, for example, while another might overweight it — and so you can end up paying a lot to achieve the average. At that point you would have been better off buying a single tracker fundA fund that aims to match the performance of a global stock market index by holding shares in companies from around the world. These funds typically track indices like the MSCI World Index or FTSE All-World Index, giving investors exposure to thousands of companies across developed markets (and sometimes emerging markets too). Because they're passively managed and simply follow the index, global tracker funds have low fees compared to actively managed funds. They're a popular choice for long-term investors wanting broad international diversification without needing to pick individual countries or companies..

The most I ever saw was a gentleman who wrote to me about his pension — he had 74 funds in it. Gulp.