Nifty 50 index mutual funds allow us to invest in top 50 stocks however most people are unaware that there are more than 40 index mutual funds. For example, Nifty Midcap 150 index that has given close to 32% annual returns vs Nifty 50’s 7% returns. When we invest in Nifty Midcap 150 stocks, we are investing stock number 101-250. And typically stock numbers 101-250 are more volatile and also more risky but at the same time provide better returns in the long run. For example Nifty 50 index has given 14% annual returns in the last 5 years While Nifty Midcap 150 index has given close to 20% returns. In my view, building a portfolio of index funds is a better approach than relying on one single index fund.