Due to stock market volatility, many investors are little scared to make fresh investments in the stock markets. Many of the equity mutual fund schemes have either given low returns or negative returns in the last 1 year. However Thematic Mutual Fund Schemes are performing well and gave up to 23% returns in the last 1 year. These funds gave 12% to 14% returns in the last 5 year tenure. What are Thematic Mutual Fund Schemes? Which are the 5 Best Thematic Mutual Fund Schemes to invest in India in 2019? Who should invest in Thematic Mutual Fund Schemes?
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What are Thematic Mutual Funds?
In simple terms, thematic mutual funds are those funds that invest in stocks pertaining to a particular theme like Consumption, ESG, Services or FMCG. These even might invest majorly in one particular sector, but not constrained to that.
Thematic Mutual Funds Vs Sectoral Mutual Funds – What’s the difference?
Let me quickly provide what’s the difference between these in below info-graphic.
How we filtered Thematic Mutual Funds list?
Here are the criteria that we have considered in filtering these equity funds.
1) Mutual Fund schemes from specific themes like consumption, ESG (Environmental, Social and Governance), Services etc. are considered here.
2) Mutual Fund schemes that performed extremely well in the last 1 year are considered
3) Mutual Fund schemes that have performed consistently in the last 2-5 years are considered in our list.
4) Funds with AUM of Rs 100+ Crores are considered.
5 Best Thematic Mutual Funds to invest in India in 2019
Let us check the list of top performing thematic equity mutual funds now.
#1 – Canara Robeco Consumer Trends Fund
Fund Investment Objective
The scheme seeks to provide long-term capital appreciation by primarily investing in equity and equity related securities of companies which directly or indirectly benefit from the growing consumer demand in India.
Fund Snapshot
| Fund | Canara Robeco Consumer Trends Fund |
|---|---|
| Theme | Consumption |
| Returns in 3mth | 4% |
| Returns in 1 year | 20% |
| Annualised Returns in 3 years | 11% |
| Annualised Returns in 5 years | 14% |
| Exp Ratio | 2.68% |
| Net Assets (AUM) Rs Crs | 354 |
Reasons to invest
This fund has performed well and gave 15% annualized returns from inception. It performed extremely well in the last 1 year and gave 20% returns. This fund invests based on Consumption theme that has stocks from banking/finance, FMCG, Services, Communication and consumer durables. This is one of the good thematic mutual fund schemes to invest for 2-5 years time frame.
#2 – Aditya Birla Sun Life India GenNext Fund
Fund Investment Objective
The scheme aims to invest in equity/ equity related instruments of companies that are expected to benefit from the rising consumption patterns in India, which in turn is getting fuelled by the high disposable incomes of the young generation (Generation Next).
Fund Snapshot
| Fund | Aditya Birla Sun Life India GenNext Fund |
|---|---|
| Theme | Consumption |
| Returns in 3mth | 4% |
| Returns in 1 year | 18% |
| Annualised Returns in 3 years | 9% |
| Annualised Returns in 5 years | 14% |
| Exp Ratio | 2.55% |
| Net Assets (AUM) Rs Crs | 1,192 |
Reasons to invest
This fund has performed well and gave 16% annualized returns since inception and performed extremely well in the last 1 year with 18% returns. This fund also invests based on Consumption theme that has stocks from banking/finance, FMCG, Services, Communication, consumer durables and health care. This is one of the best thematic mutual fund schemes to invest now in 2019.
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#3 – SBI Magnum Equity ESG Fund
Fund Investment Objective
The scheme seeks to provide investors with opportunities for long-term growth in capital through an active management of investments in a diversified basket of companies following Environmental, Social and Governance (ESG) criteria.
Fund Snapshot
| Fund | SBI Magnum Equity ESG Fund |
|---|---|
| Theme | ESG |
| Returns in 3mth | 1% |
| Returns in 1 year | 16% |
| Annualised Returns in 3 years | 8% |
| Annualised Returns in 5 years | 10% |
| Exp Ratio | 2.25% |
| Net Assets (AUM) Rs Crs | 2,503 |
Reasons to invest
This fund has performed well and gave 15% annualized return since inception. It performed extremely well in the last 1 year and gave 16% returns. This fund invests based on Environmental, Social and Governance (ESG) theme which is catching attention in the last 2-3 years. This fund invests in stocks from banking/finance, FMCG, consumer durables and technology sectors. This is one of the top performing thematic mutual fund schemes (from ESG) to invest now in 2019 for 2-5 years time frame.
#4 – Mirae Asset Great Consumer Fund
Fund Investment Objective
The scheme seeks to generate long term capital appreciation by investing in equity and equity related securities of companies that are likely to benefit either directly or indirectly from consumption led demand in India.
Fund Snapshot
| Fund | Mirae Asset Great Consumer Fund |
|---|---|
| Theme | Consumption |
| Returns in 3mth | 4% |
| Returns in 1 year | 14% |
| Annualised Returns in 3 years | 12% |
| Annualised Returns in 5 years | 13% |
| Exp Ratio | 2.22% |
| Net Assets (AUM) Rs Crs | 873 |
Reasons to invest
This fund has performed well and gave 16% annualized return since inception and performed well in the last 1 year with 14% returns. This fund also invests based on Consumption theme that has stocks from banking/finance, FMCG, consumer durables and technology sectors. This is one of the best performing thematic mutual fund schemes in India to invest for 2-5 years time frame.
#5 – ICICI Prudential FMCG Fund
Fund Investment Objective
The scheme seeks to generate long-term capital appreciation through investments predominantly in equity and related securities of FMCG companies. Around 90% of the corpus would be invested in the equities of FMCG companies, with the balance 10 per cent invested in the debt and money market instruments.
Fund Snapshot
| Fund | ICICI Prudential FMCG Fund |
|---|---|
| Theme | FMCG |
| Returns in 3mth | 4% |
| Returns in 1 year | 14% |
| Annualised Returns in 3 years | 12% |
| Annualised Returns in 5 years | 12% |
| Exp Ratio | 2.57% |
| Net Assets (AUM) Rs Crs | 523 |
Reasons to invest
This fund has performed well and gave 17% annualized return since inception and performed extremely well in the last 1 year with 14% returns. This fund invests majorly in the FMCG sector and some portion in debt instruments. This is one of the best Performing FMCG Mutual Fund schemes from thematic segment.
Here are the list of Thematic Mutual Funds to invest in India in 2019
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Who can invest in Thematic Mutual Fund Schemes?
Thematic mutual fund schemes invests in stocks across various sectors, but based on specific themes like Consumption, Services, ESG, etc. These themes could be hot cake now. However the performance may be restricted in medium to long term.
1) If you are a high risk taker and willing to invest for 2-5 years time frame, you can invest in these funds.
2) If you are a high risk taker and willing to take advantage of hot themes that are expected to perform well compared to regular sectors, you can invest some amount of your portfolio in these funds not exceeding 10%.
3) If you are a low risk taker or a moderate risk taker, you should avoid investing in such high risk mutual fund schemes.
Should you track the performance of Thematic Mutual Funds regularly?
These themes are hot cakes now. These can take a you-turn in medium to long term. Hence, one need to keep an eye on these funds.
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Suresh KP
Best Thematic Mutual Funds to invest in India in 2019
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