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These are the best technology funds in India; have you invested in them?

23 February 20246 mins read by Angel One
The greatest advantage of investing in technology mutual funds is that investors can gain access and exposure to dozens of technology stocks in just one fund.
These are the best technology funds in India; have you invested in them?
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What are Technology Funds?

Technology mutual funds are investment funds that primarily focus on investing in the technology sector. These funds pool money from multiple investors to invest in a diversified portfolio of technology-related stocks, bonds, or other securities. The goal of these funds is to provide investors with exposure to the potential growth and returns of the technology industry.

The technology sector includes companies involved in the development, manufacturing, and distribution of technology products and services. This can encompass a wide range of sub-sectors, including software, hardware, semiconductors, telecommunications, internet services, and more.

The greatest advantage of investing in technology mutual funds is that investors can gain access and exposure to dozens of technology stocks in just one fund.

Technology Sector in India

The technology sector in India is rapidly evolving and reshaping the country’s business standards. The global sourcing market in India is experiencing substantial growth, maintaining its significant position around the globe.

India’s IT industry, contributing approximately 7.7% to the country’s GDP, is anticipated to increase its contribution to 10% by 2025. Despite the challenges posed by the COVID-19 pandemic, the Indian IT industry exhibited resilience, emerging as a global economic force and a significant contributor to both the Indian and global economies.

Key players in India’s IT sector, including Infosys, TCS, Wipro, and Tech Mahindra, among others, have made significant contributions to the industry.

Technology mutual funds in India have delivered annualised returns ranging from 20% to 25% over five years. Given their strong historical performance, these funds are expected to continue providing attractive returns in the future.

Technology Funds in India:

Funds AUM Rs Cr Expense Ratio (%) Inception Date NAV Returns %
Current 52-Week High 1 M 3 M 6 M 1 Yr 2 Yr 3 Yr 5 Yr
Franklin India Technology Fund(G) 1280.3 2.13 22-Aug-98 452.24 453.18 2.77 15.44 28.62 49.85 17.91 17.25 23.12
Aditya Birla SL Digital India Fund(G) 4716.9 1.87 15-Jan-00 165.08 166.75 0.84 12.91 23.9 32.99 12.04 21.22 25.69
Tata Digital India Fund-Reg(G) 9702.1 1.69 28-Dec-15 44.13 44.39 2.4 16.28 27.43 32.35 10.53 21.49 24.24
ICICI Pru Technology Fund(G) 12248.8 1.74 03-Mar-00 181.25 182.93 1.61 15.47 24.48 28.12 8.7 20.24 24.6
SBI Technology Opp Fund-Reg(G) 3758.4 1.92 07-Jan-13 185.34 186.34 1.93 14.35 21.26 24.57 12.22 21.36 23.72
HDFC Technology Fund-Reg(G) 927.2 2.29 08-Sep-23 11.58 11.81 2.72 15.35
Quant Teck Fund-Reg(G) 280.7 2.39 11-Sep-23 12.26 12.49 4.24 24.52

 

Who should consider investing in IT funds?

  • Long-Term Investors: Technology is a sector known for its innovation and growth potential over the long term. Investors with a long investment horizon who are looking for capital appreciation over several years might consider technology funds.
  • Diversification: Investors looking to diversify their portfolios can use technology funds as a way to gain exposure to a specific sector. Diversification helps spread risk and may reduce the impact of poor performance in a single industry.
  • Tech Enthusiasts: Individuals who have a keen interest in technology, understand the industry, and believe in its future growth may find investing in technology funds aligned with their interests and knowledge.
  • Investors with Industry Confidence: Those who are optimistic about the technology sector’s future and believe it will continue to play a significant role in shaping the economy may consider allocating some of their investment portfolios to technology funds.

Conclusion

It’s important to note that while technology funds offer growth potential, they also come with risks. The technology sector can be influenced by rapid changes in technology, regulatory developments, and global economic conditions. Before investing, individuals should carefully assess their own financial goals, and risk tolerance, and conduct thorough research on the specific funds they are considering.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

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