Pharma & healthcare sector based mutual funds offered the highest return of around 5.82% in the last one month, followed by consumption funds and technology funds which gave 1.90% and 1.06% returns respectively in the same time period.
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There were around 21 equity mutual fund categories excluding equity oriented hybrid funds in the said period. The other 18 categories gave negative returns between 0.47% to 5.56% in the last one month period. International funds lost the most of around 5.56%, followed by infrastructure funds which lost 4.82% in the same period.
The mid cap and small cap funds lost around 3.41% and 3.37% respectively in the said time period. ELSS funds lost around 2.70% in the similar period. Large cap funds lost 1.74% in the last one month.
Now the question comes, will these three mutual fund categories continue to offer returns in similar fashion?
“We have been positive on consumption and pharma funds since 2024 election results. Our positive stand comes from valuations and long term outlook. We would generally refrain from looking at short term returns and their reasons. The long term opportunity in these sectors is huge and such one month returns would distract the investors,” commented Manish Kothari, Co-founder & CEO, ZFunds.
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In the pharma fund category, Aditya Birla SL Pharma & Healthcare Fund gave the highest return of around 7.73% in the last one month followed by HDFC Pharma and Healthcare Fund which gave 7.40% return. SBI Healthcare Opp Fund delivered the lowest return of around 3.68% in the same time period. Around 14 pharma funds were there in the said period.
In the consumption fund category, ICICI Prudential FMCG Fund offered the highest return of around 5.77% followed by Kotak Consumption Fund which gave 3.22% return in the same time period. HSBC Consumption Fund lost the most of around 0.74% in the said period. Around 15 consumption funds have completed one month of existence in the market.
Among nine technology funds in the said period, HDFC Technology Fund gave the highest return of around 3.90% in the last one month. Edelweiss Technology Fund gave the lowest return of around 3.17% in the said period.
After looking at the performance of these three categories, should an investor consider them for investing at this point of time? What should be the strategy and allocation?
“Only long term investors should invest in sectoral funds with a clear view of the long term opportunity. Both pharma and consumption sector thrive on per capita income growth,” recommended Kothari.
We considered all equity categories such as large cap, mid cap, large & mid cap, small cap, ELSS, flexi cap, focused fund, multi cap, value and contra funds. We considered regular and growth options. We calculated returns for the last the one month.
Thematic or sector schemes invest most of their corpus in a particular sector, and the performance of schemes is based on performance of the sector. That is why thematic or sector funds are recommended only to investors with thorough knowledge about the sector.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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