Should I invest in pharma funds? | Value Research Over any period of time, the stock markets always favour some sector more than others and a set of sector-specific funds are always doing better than others
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Should I invest in pharma funds?

Over any period of time, the stock markets always favour some sector more than others and a set of sector-specific funds are always doing better than others

Pharma funds have given good returns in the last one or two years. I would like to invest ₹5,000 via a SIP in pharma funds for two or three years. What is your view?
- Manivannan G

We do not recommend sectoral funds. Over any period of time, the stock markets always favour some sector of the economy more than others. Therefore some set of sector-specific funds are always doing better than others. Over the last many years, the favoured sector has rotated from one to another. Funds managers of a sectoral mutual fund are restricted to invest in the same sector even if the sector is not performing well. Thus, investing in a sector-specific fund is risky. Choose a diversified fund based on your risk tolerance and investment horizon. Invest in equity funds only if you have five years or more in hand.


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