Mutual fund specialist believes that a strategic allocation of 10-20% in pharma and healthcare funds could benefit investors with a moderate to long-term investment horizon since, in the long run, as healthcare demand rises owing to a variety of circumstances, the sector may provide strong returns.
"In the long run, as healthcare demand rises owing to demographic shifts, lifestyle disorders, and advances in medical technology, the sector may provide strong returns. A smart allocation of 10-20% to these funds should benefit investors with a moderate-to-long-term investment horizon," said Abhishek Jain, Head of Research at Arihant Capital.
In 2024, mutual funds centered on the pharmaceutical and healthcare sectors offered up to 44% to date.
There were approximately 13 funds in the category, which collectively provided an average return of approximately 37.20% during the specified time period.
Three schemes in the category have already returned more than 40% this year. HDFC Pharma and Healthcare Fund, the category leader, has returned 43.77% in 2024 thus far. ICICI Pru Pharma Healthcare & Diagnostics (P.H.D) Fund and LIC MF Healthcare Fund provided returns of 42.49% and 40.85%, respectively, during the specified time.
Tata India Pharma & Healthcare Fund and Mirae Asset Healthcare Fund returned 35.71% and 35.66%, respectively, over the period. Quant Healthcare Fund returned 34.65%, while Kotak Healthcare Fund returned 34.04% in the same time period.
Aditya Birla SL Pharma & Healthcare Fund and Nippon India Pharma Fund provided returns of 33.21% and 30.90%, respectively, throughout the period.
