When we talk about investing, people usually complicates it. Since we have so many financial products out there, people usually try to get a piece of everything and thus try to invest in all the products which are giving good returns at that point of time.
But what about next year, people start chasing another multibagger and thus the cycle continues. But what if we have a single fund and thus we invest in that fund and forget about it. Do we have that type of fund? Yes, we have. If you invest in Nifty50 Index Fund or Nifty 100 Index Fund or even Nifty 200 Index Fund, you actually investing in the top companies of India.
If we invest in these types of funds, we don't have to worry about rebalancing, changing investmnet strategies, changing funds and what not. For long term wealth, investing in single fund works great, or a combination of 1 to 3 funds which actually provides the diversification.
People might ask, is it risky to invest in 1 fund. Not at all, because we are investing in an index fund and not a single stock. It gives us enough diversification because it had so many stocks in it for different industries. Now we have to choose the index fund as per our risk appetite, if we have high risk appetite we can invest in braoder index like Nifty 500, if we plan to play safe then we can invest in Nifty 50 or Nifty 100 index funds.
As a begineer who don't have any knowledge of investing, should start with the minimalist investing and they don't have to think about anything else. This minimalist investing can help us to grow our money and can create substantial wealth over long term.
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