Monday, July 6, 2009

Focused Funds

If you are sure about particular sector funds, have enough knowledge in the basics of investing in those sectors and sector fundamentals, you can go for sector fund investing and reap huge benefits. Now the stock market is UP. And it seems that this trend is going to continue irrespective of the current recession. The FIIs are pushing the market up again. And it is time for the small time investor to again start doing the investments through funds.

Sector funds may add value and double your returns at this moment. But as you all know, every coin has two faces. It is better to branch your investments in sector funds while maintaining the proportional investments in other options like Open-ended mutual funds for diversification. If the boom continuous, the sector funds may add value and returns to your portfolio; but it bursts, your diversified investment portfolio will save you from the market crash.

Sector funds have high maintenance part. They come with huge overheads. It is always better to check out how much the fund is charging under the Fund Maintenance part before jumping into the ring.

Best of Luck!

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