Mutual Funds that invest in specific sector are called ‘Thematic Mutual Funds’.
Some of these have been launched in the recent decade in financial markets across the world
- Defense Fund
- Manufacturing Fund
- Technology Fund
- Health Fund
- Electric Vehicle Fund
- Gold & Silver Fund
- Pharma Fund etc.
Normally, these funds are launched when the sector is in an upswing and the fund manager wants to bank on this to make good launch to the fund.
Considering this, the fund is launched at a peak or near peak point of the theme.
This can be seen especially in case of Defense PSU theme based Mutual Funds launched in India through 2023-24.
Owing to this, it may not be in the interest of the Investor to invest in them.
If the sector is beaten down and in a downturn, investors can indeed evaluate it based on their own research or advice from their investor advisor or mutual fund distributor.
Also, while investing in Mutual Funds, what are the best Dos and Don’ts, I have shared an answer earlier
What are are some handy tips to help maximize mutual fund returns?
Hope this helps
All the best
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Happy Investing and God Bless!
About the Author of Post:
The Author is an AMFI registered Mutual Fund Distributor (ARN-262589). Reach out to him via email: edteficonsult@gmail.com
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