Best mutual funds: THESE sectoral funds delivered over 30% return in past 5 years. Check the themes that worked | Mint

If you have some dry powder and are looking for the ‘right’ mutual fund scheme to invest, it is recommended to examine the returns delivered by the scheme vis-a-vis other schemes in the same category. This gives an indication of the scope of returns which a mutual fund scheme can deliver.

Here, we list out the past five-year returns delivered by sectoral or thematic mutual funds. Sectoral funds refer to the schemes which invest at least 80 percent in the stocks of a particular sector or theme. There are a total of 212 sectoral/thematic schemes with a total asset size of ₹4.55 lakh crore.

Sectoral & thematic funds

For the uninitiated, sectoral funds are the ones which invest in a particular sector of the economy such as infrastructure, banking, technology or pharmaceuticals. Because of focus on one sector only, these funds limit diversification and are – therefore – riskier. One should try to time the investment of these funds since the performance of the sectors tend to be cyclical.

Thematic funds select stocks of companies in industries that belong to a particular theme such as infrastructure, service industries, or MNCs. These funds are more diversified than sectoral funds and have lower risk than sectoral.

These funds have delivered over 30 percent return in the past five years. Ideally, is it better to examine the historical returns over a long period of time to put this in perspective. Merely checking one or two year returns does not give the holistic idea of a scheme’s past record.

(Source: AMFI; returns as on April 22, 2025)

As we can see in the table above, themes which have delivered exceptional returns are infrastructure and manufacturing. Highest returns were delivered by Quant Infra fund ICICI Prudential Infrastructure Fund.

Meanwhile, it is important to note that the past returns do not guarantee future returns. This means just because a scheme has given exceptional returns in the past does not mean that it will give similar returns in the future as well.

Note: This story is for informational purposes only. Please speak to a SEBI-registered investment advisor before making any investment related decision.

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