The fund's performance has been disappointing & investors can consider exiting it…
01-Apr-2011 •Research Desk
I bought SBI Infrastructure Fund—Series 1 in the NFO. The fund’s performance has not been impressive. What should I do?
– Deepak Gupta
This is an infrastructure thematic fund which invests in equity stocks of those companies which are either directly or indirectly engaged in infrastructure growth in the Indian economy for long term growth. However, since its launch in June 2007, the infrastructure theme has not been as favourable as one would want it to be which is reflected in the fund’s performance. Though it had a great run in 2009, it was on back of a poor 2008 performance and its current NAV is below the NFO price of Rs 10.
You should learn from this investment that investing in thematic fund works only if the theme is compelling and is a necessity to get the diversity right in your overall portfolio. If these are not what you seek, these funds are not for you. By holding on to a non-performing fund you are losing the opportunity that other funds present. You should consider exiting this fund and investing instead in broad diversified equity funds.