Is ICICI Prudential Banking and Financial Services Fund good for long term

ICICI Prudential Banking and Financial Services Fund is a sectoral fund and invests only in banking and financial services sector in India. Any sectoral fund can be riskier compared to other equity fund categories but the potential of getting very high returns from these funds can be very tempting too.

We at Advisorkhoj always caution investors that, even though sector funds can outperform the broader market by a big margin when market and economic conditions are favorable for the sector, it should not form the core part of your portfolio as they are risky. At the same time, investors should also note that these funds can under-perform considerably when the market conditions are not favorable for the particular sector.

However, depending upon your risk appetite, you can strategically add a part of your investments in ICICI Prudential Banking and Financial Services Fund to get exposure to one of the most important and also the fastest growing sectors of Indian economy.

ICICI Prudential Banking and Financial Services Fund is a top rated fund in this sector and beaten its peers in most of the time periods since its inception in 2008. The fund has given over 21% annualized return since its inception and around 25% in the last three years.

This fund can be a good long term investment provided you are ready to take high risk and withstand volatility during your investment tenure.

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