Diversification is a must!

Experts say diversification is a must in your portfolio. In my view one should not diversify for the sake of it. It is entirely dependent on your financial goals and risk profile. I believe diversification within high quality assets makes a lot of sense. So, for example if you are investing in direct equity then instead of buying one or two high-quality stocks you can diversify by investing in 5-6 great stocks depending on the funds available. Similarly, if you are buying mutual funds then investing in all available mutual fund schemes makes no sense. You should pick the right quality long-term schemes and diversify your funds within them.