Should I invest in lots of different funds or is it best to focus on, say 6 funds?

As quoted in our 'Money Clinic with Bestinvest' webinar:

There’s no magic answer to this question, but as a general rule of thumb, you should look to strike a balance between having enough funds in your portfolio to be adequately diversified without giving yourself too many to keep track of at once. For example, though having 40 funds might sound great from a diversification point of view, can you realistically stay up to date and understand what’s going on under the bonnet for every single one of them? If not, then you’d be better off letting go of a few until you’ve got a number that you feel is genuinely manageable for you.

A good hack for tackling this dilemma is to opt for a ready-made portfolio, which are like baskets of lots of different funds, and you can pick one that suits the level of risk you’re most comfortable with and then leave all the number-crunching to the investment managers. Lots of providers, Bestinvest included, offer these ready-made portfolios, so if you want to get a better feel for who’s best to turn to, head over to our ISA compare tables to see which ones we – and our community – rate the highest.

This question was answered by Charlotte Wheeler a Financial Coach at Bestinvest