What is Thematic Fund?
Mutual funds having stocks of companies as underlying assets united by a predetermined theme are called thematic mutual funds. Thematic mutual funds invest in companies of different market caps and sectors as long as it fits into the pre-decided theme
SEBI Guidelines for Thematic Mutual Funds
According to SEBI guidelines, the minimum investment in equity and equity-related instruments of a particular theme shall be 80% of total assets
Difference between Sector and Thematic funds
Sector funds focus on specific sectors or industries such as banking, pharmaceuticals, information technology, real estate and energy.
On the other hand, Thematic Mutual Funds invest in well-defined stocks centred on specific opportunities. These may be similar to sector funds, but they may consist of multiple sectors. Thematic funds are much more diversified than sector funds.
Different types of Thematic funds available in India
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Dividend Yield Funds
Investing in companies with high dividend yields. Like all other funds, these funds report daily NAVs and dividends received from companies that are part of this fund’s portfolio are reflected in NAVs.
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PSU Equity Funds
These funds invest in public sector units (PSU) stocks listed on the stock exchange.
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Energy Funds
Invest in companies engaged in the energy and natural resources sector. The sector comprises companies involved in oil, gas and metals.
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Consumption Funds
These funds invest in consumer companies that manufacture products or offer services to consumers. Consumer-oriented sectors include automotive, FMCG (fast-moving consumer goods), consumer durables, telecommunications and financial services.
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MNC Funds
These funds invest in MNC, companies with a foreign origin that conduct their businesses in India. These businesses sell their goods and services in India and export from India, thus generating revenue and profit. MNC companies listed in India are Nestle, Gillette, Colgate, Kansai Nerolac Paints etc.
Advantages of Thematic funds
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Market beating returns
Early investments in an up-and-coming theme predicted correctly may provide higher than market returns.
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More diversification as compared to sectoral fund
Although the fund invests only within a particular theme, they are open to investing in companies from different sectors and market caps, thus saving them from downfalls in specific sectors.
Risks of Thematic funds
- High-risk investment
- Different theme outcome
If the underlined theme takes longer than expected to play out or does not play out at all, investors might face lower or negative returns.
In conclusion, Thematic mutual funds are for seasoned investors with an in-depth market understanding who already have a well-diversified portfolio and could spare a small part of their corpus to invest in decided themes.
Performance of India Focused Thematic funds
| Fund Name | Launch | Net Assets (Cr) | No of Stocks in the Portfolio | Top 10 Stocks % | 1 Yr Ret (%) | 3 Yr Ret (%) | 5 Yr Ret (%) | 10 Yr Ret (%) | 15 Yr Ret (%) | Standard Deviation | Sharpe Ratio | Fund Manager |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Edelweiss Recently Listed IPO Fund | 22-02-2018 | 1,091 | 44 | 34.11 | 50.11 | 34.93 | -- | -- | -- | 19.87 | 1.41 | Bhavesh Jain, Bharat Lahoti |
| Franklin India Opportunities Fund | 21-02-2000 | 694 | 34 | 56.5 | 21.39 | 19.86 | 15.25 | 15.76 | 10.31 | 22.36 | 0.78 | Krishna Prasad Natarajan , R Janakiraman |
| ICICI Prudential Exports and Services Fund | 30-11-2005 | 945 | 26 | 65.47 | 27.37 | 19.11 | 14.33 | 19.45 | 12.28 | 20.62 | 0.79 | Sankaran Naren , Ashwin Jain |
| ICICI Prudential India Opportunities Fund | 15-01-2019 | 4,325 | 43 | 57.37 | 46.37 | 20.36 | -- | -- | -- | -- | -- | Sankaran Naren, Roshan Chutkey |
| ICICI Prudential Manufacturing Fund | 11-10-2018 | 596 | 41 | 49.29 | 40.63 | 19.92 | -- | -- | -- | 23.44 | 0.7 | Anish Tawakley (, Lalit Kumar |
| ICICI Prudential Thematic Advantage Fund (FOF) | 18-12-2003 | 196 | -- | -- | 39.26 | 22.98 | 16.76 | 14.43 | 11.38 | 23.51 | 0.83 | Sankaran Naren ), Manish Banthia , Dharmesh Kakkad |
| SBI Magnum COMMA Fund | 08-08-2005 | 471 | 26 | 51.8 | 55.6 | 30.51 | 18.51 | 13.67 | 10.45 | 24.66 | 0.99 | Richard D'souza |
| Sundaram Services Fund | 21-09-2018 | 2,001 | 52 | 43.99 | 41.63 | 27.05 | -- | -- | -- | 23.07 | 1 | Rahul Baijal , Rohit Seksaria |
| Tata Ethical Fund | 24-05-1996 | 1,218 | 51 | 46.85 | 35.87 | 23.57 | 18.13 | 16.8 | 12.33 | 16.76 | 1.13 | Abhinav Sharma |
| Taurus Ethical Fund | 06-04-2009 | 75 | 57 | 33.68 | 23.07 | 19.49 | 16.62 | 14.82 | -- | 16.25 | 0.97 | Prasanna Pathak |
| Nippon India Power & Infra Fund | 01-05-2004 | 1,683.00 | 32 | 55.67 | 41.1 | 18.73 | 12.67 | 10.84 | -- | 26.92 | 0.59 | Sanjay Doshi |
| Franklin Build India Fund | 01-09-2009 | 1,122.00 | 30 | 54.32 | 43.63 | 19.46 | 14.78 | 19.76 | -- | 26.9 | 0.61 | Ajay Argal, Anand Radhakrishnan, |
| DSP Natural Resources & New Energy Fund | 01-09-2009 | 1,122.00 | 30 | 54.32 | 40.91 | 18.57 | 14.75 | 19.67 | -- | 26.9 | 0.61 | Ajay Argal, Anand Radhakrishnan, |
| ICICI Pru MNC Fund | 01-06-2019 | 1,071.00 | 62 | 33.96 | 32.82 | -- | -- | -- | -- | -- | -- | Anish Tawakley, Vaibhav Dusad |
| ICICI Pru Quant Fund | 01-12-2020 | 73 | 34 | 53.85 | 35.31 | -- | -- | -- | -- | -- | -- | Roshan Chutkey |
| L&T Business Cycles Fund | 01-08-2014 | 569 | 52 | 45.47 | 29.48 | 16.7 | 11.4 | -- | -- | 26.09 | 0.56 | Venigopal Manghat, Cheenu Gupta |
| SBI Magnum Global Fund | 01-09-1994 | 5,616.00 | 36 | 46 | 29.88 | 18.69 | 15.37 | 18.05 | -- | 15.26 | 1.09 | R Srinivasan |
| Aditya Birla SL Special Oppo. Fund | 01-10-2020 | 651 | 46 | 46.1 | 26.7 | -- | -- | -- | -- | -- | -- | Anil Shah, Chahal Khandelwal |
| Axis Special Situations Fund | 01-12-2020 | 2,485.00 | 75 | 36.21 | 23.66 | -- | -- | -- | -- | -- | -- | Ashish Naik |
| SBI Consumption Oppo. Fund | 01-07-1999 | 880 | 32 | 54.58 | 27.16 | 15.85 | 16.91 | 18.22 | -- | 23.41 | 0.59 | Saurabh Pant |
| Invesco India PSU Equity Fund | 01-11-2009 | 367 | 22 | 61.35 | 29.79 | 16.29 | 8.39 | 10.41 | -- | 22.85 | 0.57 | Dhimant Kothari, Nitin Gosar |
| HDFC Housing Oppo. Fund | 01-12-2017 | 1,387.00 | 37 | 68.9 | 30.26 | 12.57 | -- | -- | -- | 25.41 | 0.4 | Rakesh Vyas |
| Nippon India Quant Fund | 01-02-2005 | 32 | 35 | 51.38 | 26.8 | 17.14 | 14.19 | 12.19 | -- | 18.08 | 0.77 | Ashutosh Bhargava, Arun Sundaresan |
| Nippon India Consumption Fund | 01-09-2004 | 185 | 34 | 41.54 | 24.8 | 20.73 | 13.36 | 15.44 | -- | 19.52 | 0.89 | Amar Kalkundrikar |
| Canara Robeco Consumer Trends Fund | 01-09-2009 | 773 | 46 | 40.11 | 22.12 | 20.24 | 18.59 | 18.07 | -- | 18.98 | 0.91 | Ennette Fernandes, Shridatta Bhandwaldar, |
| Aditya Birla SL India GenNext Fund | 01-08-2005 | 2,563.00 | 71 | 31.75 | 23.35 | 18.94 | 16.68 | 19.12 | -- | 20.3 | 0.8 | Chanchal Khandelwal |
| Mirae Asset Great Consumer Fund | 01-03-2011 | 1,633.00 | 39 | 44.36 | 21.98 | 16.39 | 17.86 | 17.86 | -- | 19.59 | 0.73 | Ankit Jain, Siddant Chhabria |
| BNP Paribas India Consumption Fund | 01-09-2018 | 872 | 53 | 40.11 | 21.22 | 21.13 | -- | -- | -- | 17.09 | 0.99 | Chocklingam Narayanan, Karthikraj Lakshmanan, Mayank Prakash |
| DSP Quant Fund | 01-06-2019 | 1,334.00 | 48 | 36.18 | 16.94 | -- | -- | -- | -- | -- | -- | Anil Ghelni, Diipesh Shah |
| UTI India Consumer Fund | 01-07-2007 | 380 | 37 | 45.09 | 17.76 | 15.45 | 13.23 | 12.81 | -- | 17.66 | 0.7 | Vishal Chopda |
| Aditya Birla SL Manufacturing Equity Fund | 01-01-2015 | 648 | 40 | 48.06 | 16.81 | 14.52 | 10.74 | -- | -- | 18.17 | 0.61 | Anil Shah |
| Sundaram Rural and Consumption Fund | 01-05-2006 | 1,220.00 | 39 | 50.66 | 15.36 | 12 | 10.48 | 15.27 | -- | 21.28 | 0.45 | Ashish Aggaewal, Ratish Varier |
| Aditya Birla SL MNC Fund | 01-04-1994 | 3,917.00 | 38 | 60.24 | 7.04 | 8.93 | 10.29 | 16.65 | -- | 17.16 | 0.39 | Ajay Garg |
1 Year Returns
Performance of International Focused Thematic funds
| Thematic Funds - International Focussed | Launch | Net Assets (Cr) | 1 Yr Ret (%) | 3 Yr Ret (%) | 5 Yr Ret (%) | 10 Yr Ret (%) | Standard Deviation | Sharpe Ratio | Fund Manager |
|---|---|---|---|---|---|---|---|---|---|
| DSP World Gold Fund | 14-Sep-2007 | 934.00 | -4.88 | 17.59 | 6.46 | -0.30 | 34.37 | 0.51 | Jay Kothari |
| DSP World Mining Fund | 29-Dec-2009 | 172.00 | 20.88 | 25.78 | 16.43 | 3.59 | 25.51 | 0.84 | Jay Kothari |
| DSP World Energy Fund | 1-Aug-2009 | 179.00 | 6.14 | 7.63 | 3.17 | 3.14 | 24.34 | 0.81 | Jay Kothari |
| Sundaram Global Brand Fund | 1-Aug-2007 | 143.00 | 12.23 | 14.66 | 11.34 | 7.68 | 14.36 | 1.04 | Ashish Aggarwal, Rohit Seksaria |
| Aditya Birla SL Global Excellence Equity Fund of Fund | 1-Dec-2007 | 174.00 | 16.47 | 6.12 | 4.93 | -- | 18.15 | 0.57 | Vnod Bhat |
| HSBC Asia Pacific (Ex Japan) Dividend Yield Fund | 1-Feb-2014 | 10.00 | 0.18 | 12.39 | 10.96 | -- | 15.22 | 0.67 | B. Aswin Kumar |
| Kotak International REIT FOF | 1-Dec-2020 | 204.00 | -0.12 | -- | -- | -- | -- | -- | Arjun Khanna |
| Edelweiss US Technology Equity Fund of Fund | 1-Mar-2020 | 2,248.00 | -15.74 | -- | -- | -- | -- | -- | Bharat Lahoti, Bhavesh Jain |
| DSP World Agriculture Fund | 1-Oct-2011 | 66.00 | -8.66 | 8.56 | 4.66 | 6.52 | 14.01 | 0.82 | Jay Kothari |
| Invesco India - Invesco Global Consumer Trends Fund of Fund | 1-Dec-2020 | 684.00 | -23.75 | -- | -- | -- | -- | -- | Neelesh Dhamnaskar, Krishna Venkat Cheemalpati |
1 Year Returns
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