Mutual Funds Overlap
5paisa Research Team
Last Updated: 30 May, 2025 12:31 PM IST

Content
- What is Mutual Funds Overlap?
- What is Mutual Fund Portfolio Overlap
- Effects of Mutual Fund Overlap
- How Can You Reduce Portfolio Overlap in Your Holdings?
- Mutual Fund Portfolio Overlap Process
- How Can You Reduce Mutual Fund Portfolio Overlap?
- Why is diversification crucial to avoid Mutual Fund Overlap?
Mutual fund overlap is a critical but often overlooked aspect of portfolio management, which can hinder investors' ability to maximise returns and manage risk. When an individual invests in multiple mutual funds that hold similar stocks, the benefits of diversification are diminished, exposing the portfolio to increased risk and undermining the core purpose of mutual fund investments.
This article looks into the intricacies of mutual fund overlap, illustrating the potential pitfalls and exploring ways to identify, manage, and avoid them. By understanding the concept of mutual fund overlap and adopting a mindful investment approach, investors can enhance their portfolio's efficiency and optimise long-term financial outcomes.
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