DSP Healthcare Fund is one of the sectoral funds which gave an impressive return of 28.55 percent (direct) in past three years as on July 15, 2022. Assuming that an investor invested ₹1,00,000 in the fund scheme three years ago, it would have grown to ₹2,12,430 at this rate.
The regular returns for past three years are 26.55 percent. So, those investors who bought the fund units via a broking house made profits at the latter’s rate of interest.
So, if the same investor mentioned above had invested ₹1,00,000 via a broker, the investment would have grown to ₹2,02,668 during this period.
Either way, the fund beat the benchmark return of 21.06 percent by a healthy margin. The daily assets under management (AUMs) are ₹1,171 crore. The total returns since inception are 20.09 percent. This means if someone had invested ₹one lakh on Nov 30, 2018, the investment would have grown to ₹1,92,710.
| Fund name | Regular (%) | Direct (%) | Benchmark (%) | Daily AUMs ( ₹crore) |
| DSP Healthcare Fund | 26.55 | 28.55 | 21.06 | 1,171.68 |
(Source: AMFI as on July 15, 2022)
What are sectoral funds?
According to a SEBI’s document on ‘investments in mutual funds’, sectoral schemes are the funds that invest in the securities of only those sectors or industries as specified in the offer documents such as pharma, software, FMCG, petroleum stocks, IT, banks, etc.
The returns in these funds are dependent on the performance of the respective sectors. Experts warn that while these funds may give higher returns, they are riskier as compared with diversified funds. So, investors are supposed to keep a tab on the performance of those sectors and should exit at an appropriate time.
Sectoral funds are cyclical and can go through multiple cycles of ups and downs.
Returns from sectoral funds could be higher in the short run because most of the themes go through a cycle. However, these funds lack consistency over the long term.
About DSP Healthcare
The fund was started on November 30, 2018. There are a total of 24 equity holdings and 70 percent of assets are held in top 10 holdings.
As of June 30, the top holdings comprised Sun Pharma, Cipla, Max Healthcare, Dr Reddy's Labs, Ipca Labs, Apollo Hospitals, Procter & Gamble, Lupin, Alkem Lab and Indoco Remedies. The minimum investment one can make in the scheme is ₹500.
The fund has an access to international healthcare stocks up to 25 percent. The top four sectors wherein the fund invests are pharma & biotech (62%), healthcare services (22%), healthcare equipment & supplies (10%) and insurance (2%).
Although the past three-year returns were quite healthy, the last one-year returns remained in negative territory. In the past one year, the direct returns of this scheme were -7.82 percent while the benchmark returns were -12.59 percent.
A total of 1.34 lakh people have already invested in this scheme as of June 17, 2022.
