Skip to main content

Thematic funds – Sectorial Mutual Funds

Tax Saving Mutual Funds Online

Current open Infra Bond Application form

 

 

AN INVESTOR, who is not stock market savvy or is a sceptic, usually plays the market through the mutual funds route as seen in the past many years. But, quite often, when the market is in a bullish mode, mutual fund houses try to ride the sectoral theme in order to catch the flavour of the season.

For instance, healthcare and FMCG shares were the darlings of the investors in 2011, while banking disappointed last year due to tightening of interest rate and concerns about deteriorating asset quality. Similarly, the infrastructure theme did well in 2006 and 2007, but has underperformed significantly in 2010 and 2011.


What are thematic funds?


Broadly, thematic funds operate on themes ranging from multi-sector, international/multi-economy and commodities, to name a few.

So, should one take exposure to these thematic funds at a time when volatility in the equity market continues to remain high and most of the underlying risks have not yet subsided?

In the past that thematic funds have done well when markets are on the up move. Thematic funds are a function of market cycle, function of risk and time horizon calculated by an investor. It is a high-risk, high-return investment and if an investor has an investment horizon of three-four years, these investments would fetch him decent returns.

For novice investors identifying the right theme could be a Herculean task. These investors should invest in mutual funds and ideally, they should stick to diversified equity mutual funds, said an analyst with a mutual fund house, who spoke on condition of anonymity.

Risk profile: Thematic funds by nature are more prone to risk and volatility. The performance of these funds is dependent on the performance of a particular set sector or a theme, unlike a diversified fund that moves in line with the broader markets, said the analyst.

In the past one year, Reliance Diversified Power Sector Fund gave a negative return of 11.59 per cent, while UTI Energy Fund was down 2.7 per cent. Similarly, Sundaram Entertainment Opportunities Fund Retail Growth has delivered a negative return of nearly 16 per cent and Sundaram Capex Opportunities has fallen 10 per cent in the past one year.

Some sector/themes that do well in one year may underperform in another year.
In this case, it is difficult for a retail investor to forecast which theme/sector will do well, on a consistent basis. In that case, investors are better off investing in a diversified equity fund, where they leave that call to an experienced fund manager who can, perhaps, take a better sectoral call, and over/underweight those sectors accordingly.

Options: On the other hand, returns from diversified funds and index-based funds eked out positive returns in the past one year. HDFC Mid-Cap Opportunities Fund registered positive return of 16.4 per cent, followed by Religare Mid & Small-Cap Fund (up 10.1 per cent), DSP BlackRock Top 100 Equity Fund (6.6 per cent), UTI Opportunities Fund (12.9 per cent) and HDFC Top 200 Growth Fund (3.2 per cent).

Investment in mutual funds should be more diversified, if an investor is looking at a one-year point of view. Even, if the market remains upbeat for a longer period in a year, an investor should not go for investing in a particular sector because during correction times, these theme-based funds fall in tandem with the market due to their exposure to a particular theme,.

 
 
---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

 

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

 

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

 

These Application Forms can be used for buying regular mutual funds also

 

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. HDFC TaxSaver
  2. ICICI Prudential Tax Plan
  3. DSP BlackRock Tax Saver Fund
  4. Birla Sun Life Tax Relief '96
  5. Reliance Tax Saver (ELSS) Fund
  6. IDFC Tax Advantage (ELSS) Fund
  7. SBI Magnum Tax Gain Scheme 1993
  8. Sundaram Tax Saver

Popular posts from this blog

What is Electronic Clearing Service (ECS)?

  As the name suggests, it's an electronic process through which money can be transferred from one bank account to another. According to RBI, this mode is usually used for regular payments and receipts, like distribution of dividend, interest, salary, pension etc. This mode is also used for collection of bills for telephone, electricity, water, various types of taxes, payment of EMIs , investments in mutual funds , payment of insurance premium etc. There are two types of ECS , like most other banking transactions, ECS credit and ECS debit. An ECS credit is used by a bank account holder , usually a large company or an institution for services like payment of dividend, in terest, salary, pension etc. If your mutual fund pays you dividend to your bank account, of all probability it is being paid through ECS credit.ECS debit, on the other hand, is used when a company or an institution is getting money from a large number of people. For example if you are investing in a mutual fund sc...
Read more

WEALTH TAX

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 WEALTH TAX   WHAT CONSTITUTES WEALTH? For wealth tax purposes, "wealth" means property , urban land, car, jewellery , yacht, boat, aircraft and cash in hand in excess of Rs 50,000. CAUTION POINT | Do not think you will have an easy escape from wealth tax by transferring your `wealth' without consideration to your spouse or minor child. Such assets will also be considered as your wealth. HOW TO DETERMINE YOUR TAXABLE WEALTH Add the taxable value of the above assets (computed as per the detailed rules for valuation) owned by you as on March 31 (for FY 2014-15, it will be March 31, 2015). In case you sold your car during the year, it will not be taxable wealth. Deduct loans if any obtained by you to acquire any of the taxable assets from the value of gross tax out for at least 300 days in a...
Read more

Equity Savings Fund

Invest Equity Savings Fund Online   The best part about these funds is that they are subject to equity fund taxation and at the same time are structured like MIP like funds . This new category, equity savings funds , offer a little of everything. They allocate money to equities & equity related instruments, and fixed income. They aim to generate returns by diversification. Such funds invest in fixed income and arbitrage to protect the investors from short term volatility and equity for capital gains. The best part of these funds is that they are subject to equity fund taxation and at the same time are structured like MIP funds.   MIP funds however are subject to debt fund taxation. Investors Equity savings funds are suitable for the following: First time investors who seek partial exposure to equity with less volatility and greater stability Investors seeking moderate capital appreciation with relatively lower risk Those wh...
Read more

How to Pick Top Performing Mutual Fund Schemes

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to Pick Performing Schemes  Funds that continue to stay in the top grade of performance over longer periods are the ones to bet on, advise investment experts   The mutual fund performance charts of the past few months make for an impressive reading. Funds across all categories boast of stellar returns. Sample this: The mid and small cap category has averaged 77 percent return over the past 12 months, with the best fund delivering a staggering 120 percent. The tax-saving funds also average an impressive 51 percent, including a fund which has soared 92 percent. Many of the table-toppers are funds of proven quality and track record. However, there are also schemes that are not that well-known. Some of these have rarely made it to the performance charts in the past, yet, of late, they bo...
Read more

8% Government of India Bonds quick guide

For those seeking comfort in safety of returns, the Government of India issued 8% savings bond once again comes to the fore. First launched in 2003, these bonds are issued by the government with a maturity of 6 years. The bonds are available at all times with specified distributors through whom you can apply to invest in them. Here is a quick guide to what the bond offers and its features to ascertain to check for suitability. What are Government of India bonds Government of India bonds are like any other government bonds with specified rate of interest. The rate is fixed at 8% per annum paid half yearly, or you can opt for cumulative payment of interest at the end of the tenure. You can buy these bonds from State Bank of India and its associates, other nationalized banks and some private sector banks such as HDFC Bank Ltd and ICICI Bank Ltd, among others. The bonds can be bought from the offices of Stock Holding Corporation of India as well. They are available in physical form onl...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now