Thematic Mutual Funds

Thematic Mutual Funds

Review

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

  • 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.

  • PSU Equity Funds

These funds invest in public sector units (PSU) stocks listed on the stock exchange.

  • Energy Funds

Invest in companies engaged in the energy and natural resources sector. The sector comprises companies involved in oil, gas and metals.

  • 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.

  • 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

  • Market beating returns

Early investments in an up-and-coming theme predicted correctly may provide higher than market returns.

  • 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 NameLaunchNet Assets (Cr)No of Stocks in the PortfolioTop 10 Stocks %1 Yr Ret (%)3 Yr Ret (%)5 Yr Ret (%)10 Yr Ret (%)15 Yr Ret (%)Standard DeviationSharpe RatioFund Manager
Edelweiss Recently Listed IPO Fund22-02-20181,0914434.1150.1134.93------19.871.41Bhavesh Jain, Bharat Lahoti
Franklin India Opportunities Fund21-02-20006943456.521.3919.8615.2515.7610.3122.360.78Krishna Prasad Natarajan , R Janakiraman
ICICI Prudential Exports and Services Fund30-11-20059452665.4727.3719.1114.3319.4512.2820.620.79Sankaran Naren , Ashwin Jain
ICICI Prudential India Opportunities Fund15-01-20194,3254357.3746.3720.36----------Sankaran Naren, Roshan Chutkey
ICICI Prudential Manufacturing Fund11-10-20185964149.2940.6319.92------23.440.7Anish Tawakley (, Lalit Kumar
ICICI Prudential Thematic Advantage Fund (FOF)18-12-2003196----39.2622.9816.7614.4311.3823.510.83Sankaran Naren ), Manish Banthia , Dharmesh Kakkad
SBI Magnum COMMA Fund08-08-20054712651.855.630.5118.5113.6710.4524.660.99Richard D'souza
Sundaram Services Fund21-09-20182,0015243.9941.6327.05------23.071Rahul Baijal , Rohit Seksaria
Tata Ethical Fund24-05-19961,2185146.8535.8723.5718.1316.812.3316.761.13Abhinav Sharma
Taurus Ethical Fund06-04-2009755733.6823.0719.4916.6214.82--16.250.97Prasanna Pathak
Nippon India Power & Infra Fund01-05-20041,683.003255.6741.118.7312.6710.84--26.920.59Sanjay Doshi
Franklin Build India Fund01-09-20091,122.003054.3243.6319.4614.7819.76--26.90.61Ajay Argal, Anand Radhakrishnan,
DSP Natural Resources & New Energy Fund01-09-20091,122.003054.3240.9118.5714.7519.67--26.90.61Ajay Argal, Anand Radhakrishnan,
ICICI Pru MNC Fund01-06-20191,071.006233.9632.82------------Anish Tawakley, Vaibhav Dusad
ICICI Pru Quant Fund01-12-2020733453.8535.31------------Roshan Chutkey
L&T Business Cycles Fund01-08-20145695245.4729.4816.711.4----26.090.56Venigopal Manghat, Cheenu Gupta
SBI Magnum Global Fund01-09-19945,616.00364629.8818.6915.3718.05--15.261.09R Srinivasan
Aditya Birla SL Special Oppo. Fund01-10-20206514646.126.7------------Anil Shah, Chahal Khandelwal
Axis Special Situations Fund01-12-20202,485.007536.2123.66------------Ashish Naik
SBI Consumption Oppo. Fund01-07-19998803254.5827.1615.8516.9118.22--23.410.59Saurabh Pant
Invesco India PSU Equity Fund01-11-20093672261.3529.7916.298.3910.41--22.850.57Dhimant Kothari, Nitin Gosar
HDFC Housing Oppo. Fund01-12-20171,387.003768.930.2612.57------25.410.4Rakesh Vyas
Nippon India Quant Fund01-02-2005323551.3826.817.1414.1912.19--18.080.77Ashutosh Bhargava, Arun Sundaresan
Nippon India Consumption Fund01-09-20041853441.5424.820.7313.3615.44--19.520.89Amar Kalkundrikar
Canara Robeco Consumer Trends Fund01-09-20097734640.1122.1220.2418.5918.07--18.980.91Ennette Fernandes, Shridatta Bhandwaldar,
Aditya Birla SL India GenNext Fund01-08-20052,563.007131.7523.3518.9416.6819.12--20.30.8Chanchal Khandelwal
Mirae Asset Great Consumer Fund01-03-20111,633.003944.3621.9816.3917.8617.86--19.590.73Ankit Jain, Siddant Chhabria
BNP Paribas India Consumption Fund01-09-20188725340.1121.2221.13------17.090.99Chocklingam Narayanan, Karthikraj Lakshmanan, Mayank Prakash
DSP Quant Fund01-06-20191,334.004836.1816.94------------Anil Ghelni, Diipesh Shah
UTI India Consumer Fund01-07-20073803745.0917.7615.4513.2312.81--17.660.7Vishal Chopda
Aditya Birla SL Manufacturing Equity Fund01-01-20156484048.0616.8114.5210.74----18.170.61Anil Shah
Sundaram Rural and Consumption Fund01-05-20061,220.003950.6615.361210.4815.27--21.280.45Ashish Aggaewal, Ratish Varier
Aditya Birla SL MNC Fund01-04-19943,917.003860.247.048.9310.2916.65--17.160.39Ajay Garg

1 Year Returns

Performance of International Focused Thematic funds

Thematic Funds - International FocussedLaunchNet Assets (Cr)1 Yr Ret (%)3 Yr Ret (%)5 Yr Ret (%)10 Yr Ret (%)Standard DeviationSharpe RatioFund Manager
DSP World Gold Fund14-Sep-2007934.00-4.8817.596.46-0.3034.370.51Jay Kothari
DSP World Mining Fund29-Dec-2009172.0020.8825.7816.433.5925.510.84Jay Kothari
DSP World Energy Fund1-Aug-2009179.006.147.633.173.1424.340.81Jay Kothari
Sundaram Global Brand Fund1-Aug-2007143.0012.2314.6611.347.6814.361.04Ashish Aggarwal, Rohit Seksaria
Aditya Birla SL Global Excellence Equity Fund of Fund1-Dec-2007174.0016.476.124.93--18.150.57Vnod Bhat
HSBC Asia Pacific (Ex Japan) Dividend Yield Fund1-Feb-201410.000.1812.3910.96--15.220.67B. Aswin Kumar
Kotak International REIT FOF1-Dec-2020204.00-0.12----------Arjun Khanna
Edelweiss US Technology Equity Fund of Fund1-Mar-20202,248.00-15.74----------Bharat Lahoti, Bhavesh Jain
DSP World Agriculture Fund1-Oct-201166.00-8.668.564.666.5214.010.82Jay Kothari
Invesco India - Invesco Global Consumer Trends Fund of Fund1-Dec-2020684.00-23.75----------Neelesh Dhamnaskar, Krishna Venkat Cheemalpati

1 Year Returns

Also, have a look at Best Small Cap Mutual Funds & AMC Profiles,  If you need any assistance on How To Invest In Mutual Funds Feel free to contact Wealth Baba – Financial Planner & Investment Advisor in India. We will try to help you out in the best possible way.

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