What does sector specific funds work ?

These funds/schemes invest only in securities from the specified industries or sectors as stated in the offer documents. E.g. Software, Pharmaceuticals, Software and Fast Moving Consumer Goods, (FMCG), Oil stocks, etc. These funds' returns are affected by the performance of their respective industries and sectors. These funds can offer higher returns than diversified funds, but they are more risky. Investors must be aware of the performance of these sectors and industries, and exit when necessary. Investors may seek expert advice.