If you are planning to invest in a mutual fund scheme and are currently on the lookout for a good scheme to invest, be mindful of the fact that there are multiple categories to choose from. One could, for instance, choose between a large cap scheme and a small cap scheme, and from flexi cap fund to hybrid fund.
There are some investors who have a higher risk appetite and, therefore, like to invest in a particular theme or sector rather than diversifying risk across sectors. For such investors, we list out the returns of past five years to give an idea of how different themes and sectors have performed. Here, we showcase the sectoral and thematic mutual funds which have delivered an annualised return of over 25 percent in the past five years.
And for those who are not aware of what sectoral and thematic funds are, we explain what they mean.
Sectoral funds invest in a particular sector of the economy such as infrastructure, banking, technology or pharmaceuticals etc. Since these funds focus on just one sector of the economy, they limit diversification, and are thus riskier. These include funds that invest in pharma, healthcare, banking, finance, FMCG and technology funds.
Thematic funds select stocks of companies in industries that belong to a particular theme. For example, infrastructure, service industries, PSUs or MNCs. As one can speculate, they are more diversified than sectoral funds and hence have lower risk than them. There are 187 schemes in this category with total assets under management (AUM) of ₹4.52 lakh crore, reveals the AMFI (Association of Mutual Funds in India) data as on Oct 31, 2024.
With benchmark indices already down by 10 percent from their peaks, investors are on the lookout for parking some of the dry powder they have in the high-performing sectoral/thematic mutual funds.
At the risk of relying too much on historical returns, one can examine the sectoral schemes which have given more than 25 percent annualised return in the past five years.
Sectoral/thematic funds | 5-year-return (%) | AUM ( ₹crore) |
| Aditya Birla Sun Life Digital India Fund | 28.02 | 5,253.63 |
| Bandhan Infrastructure Fund | 29.07 | 1,694.79 |
| DSP Healthcare Fund | 30.91 | 3,204.42 |
| DSP India T.I.G.E.R. Fund | 28.22 | 5,256.14 |
| Franklin Build India Fund | 27.27 | 2,707.39 |
| Franklin India Opportunities Fund | 27.20 | 5,549.07 |
| ICICI Prudential Commodities Fund | 31.02 | 2,386.34 |
| ICICI Prudential Infrastructure Fund | 29.94 | 6,785.17 |
| ICICI Pru PHD Fund | 30.00 | 4,932.35 |
| ICICI Prudential Technology Fund | 30.22 | 13,975.15 |
| Mirae Asset Healthcare Fund | 28.29 | 2,660.64 |
| Nippon India Pharma Fund | 27.43 | 8,473.70 |
| Nippon India Power & Infra Fund | 29.35 | 7,111.63 |
| Quant Infrastructure Fund | 33.12 | 3,413.68 |
| SBI Healthcare Opportunities Fund | 28.73 | 3,399.71 |
| SBI Technology Opportunities Fund | 27.30 | 4,497.32 |
| Tata Digital India Fund | 29.24 | 12,195.69 |
| UTI Healthcare Fund | 27.48 | 1,164.91 |
(Source: AMFI; Regular returns as on Nov 22)
As one can see in the table above, ICICI Prudential Technology Fund gave 30.22 percent annualized return in the past five years. Quant Infrastructure Fund delivered 33.12 percent return in the past five years and DSP Healthcare Fund gave 30.91 percent return.
When seen from the size of assets, ICICI Prudential Technology Fund ( ₹13,975.15 crore) and Tata Digital India Fund ( ₹12,195.69 crore) are the largest sectoral funds which have given high returns.
Note: This story is for informational purposes only. Please speak to a SEBI-registered investment advisor before making any investment related decision.
