Is it right time to invest in pharma sectoral Mutual Funds ?
Of late Pharma sector is buzzing and all self certified analysts saying that this sector is recession proof.
If you invest through Mutual Funds, then the risk should be substantially lower than direct exposure and returns should be consistently reasonable for atleast 5 years. None of the sectoral scored in this count. Previously hype around IT sector and Infrastructure. They didn't perform well. You are well off in investing in the diversified mutual funds (esp. through SIP). Because the fund mangers is under no compulsion to hold a sector which has no value. But a sectoral Mutual fund manger could not park the money outside the sector.
Don't carried away by hype. History repeats. If you still wanted to invest then make sure that your exposure to any sector didn't exceed 10 percent of your portfolio.
Every time there is excessive optimism surrounding a sector in general or a stock, it is always difficult to get through to investors. So overtaken are investors with the lure of making easy money that they refuse to be rational. Common investors continue to remain invested till all the hype surrounding the sector/stock has peaked and subsequently waned. In the process, we, the investor, probably make a return that does not compensate for the commensurate risk.
If you invest through Mutual Funds, then the risk should be substantially lower than direct exposure and returns should be consistently reasonable for atleast 5 years. None of the sectoral scored in this count. Previously hype around IT sector and Infrastructure. They didn't perform well. You are well off in investing in the diversified mutual funds (esp. through SIP). Because the fund mangers is under no compulsion to hold a sector which has no value. But a sectoral Mutual fund manger could not park the money outside the sector.
Don't carried away by hype. History repeats. If you still wanted to invest then make sure that your exposure to any sector didn't exceed 10 percent of your portfolio.
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