Is it a good time to invest in banking sector funds? - Ravi Deshpande, Nasik
Agreed that the banking sector is playing an important role in the economic recovery, but that alone should not be the reason for you to invest in a sectoral fund. Typically, investments in sector funds best suit those who have a good appetite for risk and understand the workings of the sectors in the economy to benefit from them accordingly.
You should invest in these funds only if you can stomach the risk involved, or, if there is an imbalance towards this sector in your overall portfolio’s sector allocation. If these are not the reasons for you to consider investing in sectoral funds, you will be better off staying invested in diversified equity funds.
