New Delhi, Oct. 22 -- When it comes to mutual funds, most investors assume the more schemes they hold, the safer their money is. At first glance, a long list of funds sounds reassuring, much like diversifying your investments by spreading your investments across multiple baskets.

However, the truth is, it is often a duplication in disguise. A robust portfolio is characterized not by numbers but by purpose. Every fund should play a distinct role in helping you meet your financial goals. Think of it as assembling a team where everyone has a designated position, no one overlaps, and together they achieve a common goal.

Start with the basics: Asset allocation

Before selecting funds, the foundation must be established: how much money should...