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| Name of the scheme | 1-year back | Invest now | Fund category | expense ratio |
|---|---|---|---|---|
| Axis Nifty 50 Index Fund | +32.80% | Invest now | Equity: Big Cap | 0.12% |
| Axis Nifty 100 Index Fund | +38.59% | Invest now | Equity: Big Cap | 0.21% |
| Axis Nifty Next 50 Index Fund | +71.83% | Invest now | Equity: Big Cap | 0.25% |
| Axis Nifty 500 Index Fund | , | Invest now | Equity: Flexi Cap | 0.10% |
| Axis Nifty Midcap 50 Index Fund | +46.03% | Invest now | Equity: Mid Cap | 0.28% |
Why diversification matters
Nilesh D Naik, the head of investment products in the share. Market (PhonePe Wealth), says that diversification is similar to the creation of a strong cricket team.
“The way a good mixture of batsmen and bowlers creates a malignant team, a well diverse portfolio balances different asset classes,” they say.
Each asset reacts differently in class-equities, fixed income, and gold-core different risk-retrurn profiles and economic conditions.
This helps manage low correlation risk between asset classes and improves overall portfolio performance.
Balance of risk in a portfolio
Investors should divide their portfolio into two sections.
“The first part must cover short -term financial needs, ideally in low -risk assets like fixed income. The second part, for long -term goals, should balance gold on the basis of equity, fixed income and risk tolerance,” Naik suggested.
He said that equity with a historical recession of 40â50%could be highly unstable, which makes it necessary to determine the proper risk based on personal risk capacity.
Hedging against market volatility
Long -term investors can make instability best through diversification.
Naik advised, “It is important to invest on time through asset classes, geography, securities and systematic investments.”
The correct mixture alliance with risk tolerance helps investors to be disciplined and avoid making emotional decisions during market fluctuations.
He emphasizes that market instability is inherent to equity and should be accepted instead of apprehension.
Also read See India’s first IPO-centric ETF and FOF: Should you invest?
International diversification is still relevant
Despite the increase in global market correlation, international diversification remains valuable.
“The relationship between Indian and American equity has been within the range of 0.5 to 0.6 in various periods. While positively correlated, this level still provides meaningful diversification benefits,” Naik explains.
Allocating a portion of investment internationally can increase risk-pair.
Avoiding emotional investment decisions
A clear asset allocation structure helps investors to avoid impulse responses for market disturbance.
“Decision should be based on risk tolerance rather than investment objectives, time horizons and short -term market movements,” Naik says.
Investors can use relative evaluation measures to direct strategic changes, following their long -term strategy.
He warns that many investors ignore asset allocation principles during bull markets, feeling their importance only when the markets are correct.
Ultimately, maintaining a disciplined investment approach and diversifying the asset classes can help investors navigate instability by optimizing long -term benefits.
Also read How to choose the right index fund for your investment portfolio
(Tagstotranslet) Investment Risk (T) Investment (T) Diversification (T) Investment Diversification (T) Investment Returns
