I would like to know if this is the right time to invest in mutual fund schemes that focus highly on realty stocks.
Harbans Keswani
At present there is no sector fund that invests predominantly in the real estate sector. Moreover, despite being a high risk-high reward sector, real estate has its own problems that have led to few takers investing in this sector. The sector is sensitive to interest rate fluctuation and inflation. Several of these factors have resulted in mutual funds not finding the sector attractive enough to invest in and there is hardly any significant exposure by mutual funds in this sector. In a scenario where no real estate focused fund exists; you can at best consider investing realty stocks directly provided you have the ability to stomach the associated risks.
This article was originally published on January 27, 2012.
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