What is the 80% rule for mutual funds?

The "80/20 rule" for mutual funds, derived from the Pareto Principle, suggests that approximately 80% of your investment returns will originate from only 20% of your holdings or funds. This principle emphasizes focusing on the few key investments that generate the majority of the portfolio's growth. In a separate context related to delivery sell trades, 80% of the total amount may be available instantly after the trade.