Buy list concentration, the appeal of 'star' fund managers and liquidity issues can result in a large number of fund buyers sticking to a select few vehicles, which in turn leads to high levels of assets under management (AUM) in a small number of funds.
However, they could be missing a trick; are there smaller, more nimble and therefore more attractive funds out there that are being overshadowed by household names?
Or should investors retain conviction in their favoured, larger funds, in spite of their growing AUMs?
Peter Brunt, associate director of equity strategies and manager of research at Morningstar, said there are advantages to investing in smaller funds.
"Firstly, the manager can be more nimble when investing in companies with a smaller market capitalisation because it is easier to buy and sell smaller ticket sizes where there is less liquidity. However, this is more of an advantage for funds with smaller companies mandates," he reasoned.
"Not only this, often the larger the client base and invested amounts, the greater the demands on the fund manager from the investor. So, for a small fund, the manager is likely to have to spend less time reporting to clients and can focus on investing."
Shauna Bevan, director of RiverPeak Wealth, added, however, that small- and mid-cap fund managers need to be more cognisant of fund size in order to mitigate liquidity problems.
As such, she always discusses fund capacity with fund managers before deciding whether to buy, hold or sell.
"It is important to ask fund managers how quickly they are getting towards what they think their capacity is and what they intend to do - the only solution for open-ended funds is to stop marketing it long before liquidity becomes an issue," she explained.
"Closing the fund to new investors, or limiting trade size on a platform that cannot accommodate it, can cause real headaches for investors who are trying to ensure consistency across their client base."
Meanwhile, Kelly Prior, investment manager in the multi-manager team at BMO Global Asset Management, explained the team, who have been picking funds together for more than 20 years, often select funds that are not the largest in their respective sectors.
"All funds have to start somewhere and never will a manager be more motivated to perform than when they are trying to grow their fund," she pointed out.
"Not only will that manager have a pin-sharp focus on the portfolio, but by having a smaller fund, they naturally have fewer issues when buying and selling underlying holdings.
"Liquidity is a much-lauded attribute, particularly in volatile markets when you may want to take advantage of a price change in a stock, only to find that there are not enough sellers out there to fill your order."