Watch the second part of Types of Equity Mutual Funds videos to learn about sectoral funds, and international funds. The video also talks about what is diversified equity mutual funds, and how they make it easy to invest your money in diversified assets.
Let’s say you’re free to go ahead pick a diverse range of different fruits, from different trees of different qualities from a garden, at the price of a regular fruit basket. That’s the main basis of mutual funds – diversification at relatively low cost. Then what is a diversified equity mutual fund and how is it different? The answer is that they further this principle, a diversified equity fund spreads its portfolio across a mixed basket of stocks.
But hey! A lot of people, like you, only like apples, making apples quite popular and in demand. This means that a lot of companies that manufacture ingredients which help these apples grow, will also benefit from the popularity of apples.
Yes, when a particular industry thrives it takes all its suppliers up with it! That’s how we can classify the second type of equity funds. So to recap what is thematic fund? These funds invest in more than one industry or sector, generally with a correlation between them, although that is not always necessary. Like ‘Infrastructure’ which has gained popularity in the last few years, based on which equity funds invest in sectors or industries which benefit or affect the overall infrastructure development in the country.
Ok but the truth is there really is no fruit like the king of fruits and it’s called the ‘Mango’! Have you noticed how all types of mangoes are always in demand? Whether it’s Alphanso, Dasheri, Langda, Dudhiya, Malda… everybody wants to eat a mango, so maybe you should invest everything in that one, grand fruit! That’s how Sector Funds are classified. This category of funds focuses their investments on certain industries only, constructing the portfolio from companies from that sector and allowing an investor to exploit the opportunities offered by it.
Watch this short video to understand sector funds better:
https://www.youtube.com/watch?v=kd2q8h6CSuE
International or cross-border diversification is also quite popular.
Explore the various equity mutual funds scheme:
https://www.franklintempletonindia.com/investor/funds-and-solutions/funds-explorer/funds-explorer?secondFilter-2
We hope you enjoyed watching this video! Watch more, and we’ll help you learn about different investing concepts. You can also write to us with your feedback (editor@templeton.com)
View more such videos in the playlist Franklin Templeton Academy:
https://www.youtube.com/playlist?list=PLpDLpRd877mRvP2fuzG7Bby1cwuLQ6i3W
Invest in Mutual Funds with Franklin Templeton.
Official Website:https://www.franklintempletonindia.com/
Facebook:https://www.facebook.com/FranklinTempletonIndia/
LinkedIn: https://www.linkedin.com/company/3676/
Instagram: https://www.instagram.com/ftiindia/?hl=en
Twitter: https://twitter.com/ftiindia?lang=en
