Dear Sreekanth
Hope you are doing well . Am planning to start SIP in ICICI Prudential Banking and Financial Services fund for long term ( I'e for 25 years ) . When i had looked at the Reliance Banking fund performance in year 2007 ( I'e the year we have almost 40 to 50 % negative returns by almost every mutual fund ) , this Banking fund had given 30% negative returns ( I'e 10 percent less ) .
what is your view on investing in this sector oriented fund for long term .
thank you in advance..
Regards
Brahmareddy.S
3 Answers
Dear Brahma Reddy,
Personally, i believe that there is lot of untapped market w.r.t financial services sector in India.
The banking sector is going through a consolidation phase and some reforms have been being implemented. There can be issues with Non performing Assets with some banks in the near future.
As your investment time-frame is long, you may invest a small portion of your investible surplus in this sector based MF scheme.
But do note that banking sector is a cyclical industry, do understand the high risks associated with sector or theme based MF schemes.
thank you so much Sreekanth . In this case i think i should avoid this sector fund . I could see all the Large OR midcap funds are investing almost 30% of fund value in Banking sector already . I dont see any reason for choosing to invest additional surplus in this sector fund.
thanks again sreekanth .
Regards
Brahmareddy.S
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