Among a wide range of categories, such as flexi-cap, ELSS, value, multi-cap and contra funds, one category that is quite popular is thematic mutual funds. Those who are not aware, thematic mutual funds select stocks of companies in industries that belong to a particular theme. They are more diversified than sectoral funds and hence have lower risk than sectoral funds. Unlike diversified funds that spread money across many sectors, thematic funds focus on just one idea or sector. “For most retail investors in 2026, thematic funds are better kept as a small add-on, not the main part of the portfolio.

Source: Mint January 13, 2026 14:21 UTC