Here's the Top 20 ranked according to Year To Date (YTD) performance:

Yeap, the size of a fund does contribute to the performance of the fund. Just take a look again at the top 20 table. 10 of the Top 20 funds have a fund size of RM50 million or lesser. This goes to say that small sized funds tend to perform better then bigger funds.

In other words, a fund that is small in size is akin to a mouse, quick and fast to react. Larger funds (RM500 million and above) are similar to an elephant, slow to react and generally struggle to generate higher returns.

Here's an example I would like to share on the growth of a top performing small fund. 4 Years ago, Kenanga Growth Fund has a fund size of only RM 53.63 million (31 January 2012). The fund was a rising star under the Category Equity Malaysia and grew over the next 4 years, garnering 7 Lippers Awards between 2013 to 2015.

Presently Kenanga Growth Fund has grown 10 times its size! At RM574.01 million, this fund is the largest in the top 20 list. However the fund is still considered small as compared to other popular funds that have ballooned to RM1 billion or more in terms of size. 

At Invest Made Easy, Kenanga Growth Fund is still part of our Recommended Funds list due to its outstanding fund manager as well as excellent investment philosophy.

Yes, the evergeen advice of "Don't put all your eggs in a single basket" is still philosophy held in high regards by smart investors.

Stock investors for example practice diversification by selecting stocks from various industries. Unit Trust investors on the other hand diversify through different categories or sectors. As a matter of fact, the top 20 funds come from seven different categories/sectors as shown below:

Diversifying your investment s into different categories and sectors helps to create a balanced portfolio that offers you protection in the event that funds from a particular category/sectors fail to perform. If you like to learn how to create your own portfolio of unit trust funds, do check out this post "Unit Trust Portfolio Diversification".

On the other hand, there's also the problem of over diversification. This tend to happen to investors whom are not aware of the funds they are investing in. A simple example is via the Top 20 list above. Some investors tend to have in their portfolio several fund from the same category or sector. The problems starts when a downturns occurs to a particular category or sector This will result to losses to multiple funds which you own. Therefore when you build your investment portfolio, make sure you're not making the mistake of "over diversifying". Always try to select the best fund from each category instead of several top funds from the same category.

These are the top 3 tips which you apply for your unit trust investment come 2016. Always remember, spending time into self learning and researching will definitely help you to make wiser and better investment decisions.

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