Over the past two financial years, thematic/sectoral funds have received a net sum of Rs 50,860 crore. In the financial year alone, these funds received a net inflow of Rs 23,731 crore.

Thematic/sectoral Fund is a diversified category which includes schemes such as Informational Technology, Banking, Energy, ESG and others.

Data shows that over a long-term period of five years, IT and Pharma has been among the best-performing categories, whereas in the short-term Banking and Infrastructure sectors have performed well.

Further, despite the market correction in the past year, Thematic PSU funds have performed very well. Investing in thematic/sectoral funds carries higher risks and, thus, more lucrative rewards.