5 Best Technology Mutual Funds in India (April 2023)
Technology mutual funds are sectoral mutual fund schemes that primarily invest in the stocks and debt securities of companies that provide technology-based products or services. Due to the higher asset allocation to equities, technology funds are also considered as a type of equity fund. Check out our list of 5 best technology mutual funds and invest accordingly.
Best Technology Mutual Funds in India 2023
Here are the best technology mutual funds 2023 in India that you can invest:
| Funds | Features |
| Aditya Birla Sun Life Digital India Fund | AUM: ₹3338.13 crore NAV: ₹117.22 Expense Ratio: 2.12% |
| Franklin India Technology Fund | AUM: ₹712.41crore NAV: ₹294.33 Expense Ratio: 2.41% |
| SBI Technology Opportunities Fund | AUM: ₹2851.77 crore NAV: ₹138.97 Expense Ratio: 2.06% |
| Tata Digital India Fund | AUM: ₹6765.81crore NAV: ₹31.37 Expense Ratio: 1.95% |
| ICICI Prudential Technology Fund | AUM: ₹8993.01 crore NAV: ₹132.01 Expense Ratio:2.11% |
Disclaimer: Mutual fund investments are subject to market risks, read all offer documents carefully.
Also Read
Detailed Overview of 5 Best Technology Mutual Funds
1. Aditya Birla Sun Life Digital India Fund
Considered as one of the best technology mutual funds due to its past performance, this mutual fund was launched on 1st January 2013 and is a medium-sized fund of its category. With a large share of holdings in the technology sector, this fund has shown consistent returns. The current top companies that this fund invests in are some of the best technology funds, including Infosys, TCS, HCL Technologies, Tech Mahindra, and LTIMindtree.
- NAV: ₹117.22
- Expense ratio: 2.12%
- AUM: ₹3338.13 crore
- Risk: Very high
- Minimum investment: ₹1,000
- Type of fund: Thematic/Sectoral
- Returns:
- Annualised 1-Year Return: -14.3%
- Annualised 3-Year Return: 42.7%
- Annualised 5-Year Return: 21.4%
2. Franklin India Technology Fund
Offered by Franklin Templeton Mutual Fund, this fund has shown good results over the years. It majorly holds stocks of technology, capital goods, services, and communications companies. Some of its major current holdings include Infosys, TCS, HCL Technologies, Franklin Technology Fund and Bharti Airtel.
- NAV: ₹294.33
- Expense ratio: 2.41%
- AUM: ₹712.41 crore
- Risk: Very high
- Minimum investment: ₹5,000 (lump sum)
- Type of fund: Thematic/Sectoral
- Returns:
- Annualised 1-Year Return: -11.0%
- Annualised 3-Year Return: 29.2%
- Annualised 5-Year Return: 16.9%
3. SBI Technology Opportunities Fund
This fund is offered by SBI Mutual Fund and is counted among the best IT mutual funds. It has shown good results and has displayed the capacity to control the losses during a market downturn. The current top investments of this fund are in the shares of Infosys, TCS, Bharti Airtel, HCL Technologies, and Netflix.
- NAV: ₹138.97
- Expense ratio: 0.89%
- AUM: ₹2851.77 crore
- Risk: Very high
- Minimum investment: ₹5,000 (lump sum)
- Type of fund: Thematic/Sectoral
- Returns:
- Annualised 1-Year Return: -9.5%
- Annualised 3-Year Return: 39.8%
- Annualised 5-Year Return: 21.6%
4. Tata Digital India Fund
This fund was launched by Tata Mutual Fund on 4th December 2015. With a focus on the technology sector, a minor portion of this fund also holds shares in the communication, services, and capital goods sectors. The top holdings in this fund are Infosys, TCS, HCL Technologies, Bharti Airtel and LTIMindtree.
- NAV: ₹31.37
- Expense ratio: 1.95%
- AUM: ₹6765.81 crore
- Risk: Very high
- Minimum investment: ₹5,000 (lump sum)
- Type of fund: Thematic/Sectoral
- Returns:
- Annualised 1-Year Return: -16.8%
- Annualised 3-Year Return: 41.9%
- Annualised 5-Year Return: 22.7%
5. ICICI Prudential Technology Fund
Launched on 3rd March 2000, the ICICI Prudential Technology Direct Plan Growth fund is counted among the best . The top holdings of this fund includes shares of Infosys, Tata Consultancy Services, HCL Technologies, Bharti Airtel, and Wipro.
- NAV: ₹132.01
- Expense ratio:2.11%
- AUM: ₹8993.01 crore
- Risk: Very high
- Minimum investment: ₹5,000 lump sum
- Type of fund: Thematic/Sectoral
- Returns:
- Annualised 1-Year Return: -17.9%
- Annualised 3-Year Return: 46.2%
- Annualised 5-Year Return: 21.9%
*Data taken from respective AMC websites on Feb 28, 2023. Sata for illustrative purposes only. Past performance is no guarantee of future returns.
Disclaimer: Mutual fund investments are subject to market risks, read all offer documents carefully.
Benefits of Technology Mutual Funds
Here are some of the benefits of tech mutual funds:
1. Allows you to Invest in a Wider Range of Stocks
Investing in sectoral-technology funds allows you to diversify your portfolio and reduce the overall risk associated with investing in a single stock. Since the best technology mutual funds invest in a wide range of companies operating in different segments of the technology sector, they provide investors with access and benefit from a wider section of the sector.
2. Focuses on High-growth Companies
The technology sector is well known for its high-growth potential. Moreover, the companies in this sector display strong fundamentals, thus making their stocks resilient even during economic downturns. As the focus on technology increases globally, these companies are expanding rapidly and reaching new heights.
3. Expert Management
The best tech mutual funds are managed by experienced fund managers who have extensive knowledge and expertise in the technology sector. They use their expertise to select high-performing stocks and make informed investment decisions.
4. Potential for High Returns
Technology stocks have historically shown strong returns, and sectoral-technology funds provide investors with the opportunity to benefit from this growth potential. Many of these companies also offer high dividends to their shareholders. Moreover, the industry is rapidly growing and there are high expectations of increased global spending in tech. With technology and AI becoming a base of the latest innovations, an investment in this sector is likely to benefit you.
5. Liquidity
Top technology mutual funds are highly liquid, allowing investors to buy or sell shares at any time without having to wait for a specific period. This will allow you to withdraw your funds whenever you want, without having to search for potential buyers to cash in on your investment.
Calculate Your Mutual Fund Returns
Total Investment
Expected return rate (p.a)
%
Time Period (Years)
Invested Amount
0
Est. Returns
Total Value
Why Invest in Technology Mutual Funds?
Over the years, the Indian technology sector has shown immense growth. The stocks have brought in strong returns and have outperformed the broader market. This trend is expected to continue, given the growing demand for technology products and services in an increasingly digital world.
The future of the technology sector is predictably bright, with advancements in artificial intelligence, 5G networks, and the Internet of Things (IoT) driving innovation and growth in the industry. As a result, investing in technology mutual funds offers investors the opportunity to benefit from the long-term growth potential of the technology sector, while diversifying their portfolios and minimising their risk.
With the expertise of professional fund managers and the convenience of a cost-effective investment vehicle, the best technology mutual funds offer an attractive option to those who are looking to invest in the technology sector to get closer to their financial goals.
Who Can Invest in Technology Mutual Funds?
Technology mutual funds are suitable for:
1. Investors with a High-risk Appetite
If you have a high-risk tolerance, you should consider the best IT mutual fundsfund. All industries have ups and downs, and due to the investment mandate, a fund must remain invested in technology-based company stocks/securities even when the sector is performing poorly. When fund managers have exposure to various industries, they can shift funds from underperforming sectors to serving ones. The volatility of technology funds is higher than that of diversified funds.
2. Investors with Greater Market Knowledge
It is also appropriate for investors who are more knowledgeable about markets and macroeconomic situations. A Sectoral Fund is an option if you have patience and an eye for tracking the growth of various market sectors. You should check if technology-based stocks and funds perform well and are worth investing in.
3. Investors with a Long-term Investment Horizon
If you are willing to commit to long-term investment, any sector requires adequate development time. Technology Funds experts do not recommend short-term investments.
Also Read
How to Invest in Technology Funds?
Follow the steps below to invest in best technology funds:
- Step 1
Go to the AMC’s website or download their app
- Step 2
Select technology funds that match your investment goals
- Step 3
Complete your KYC
- Step 4
Start investing in lump sum or via SIP
When to Invest in Technology Mutual Funds?
According to Value Research, a mutual fund tracking firm, technology, or IT sector funds provided an average return of 67 percent in 2021. These funds have returned a whopping 67 percent (YTD). This year, IT funds topped the performance chart.
This year, the ICICI Prudential Technology Fund returned 77 percent. Seven of the eight IT schemes that have completed a year of operation provided more than 60% returns in 2021. Franklin India Technology Fund has one scheme. So the straightforward answer is if you want to invest in a Technology mutual fund, the time is now!
Taxation on Technology Mutual Funds
Technology mutual funds are taxed as equity funds. If you sell your mutual fund units within 12 months, your returns (STCG) will be taxed at 15%, irrespective of your income tax bracket. On the other hand, if you sell your investment after 12 months, the returns will be taxed as LTCG (Long-Term Capital Gains). The tax rate for the same is 10%. However, you must note that gains up to Rs.1 lakh are exempt from tax.
Final Word
Because the technology sector is constantly expanding, some of your investments may face some short-term headwinds. However, experts believe that technology mutual funds will outperform global equity funds shortly. Select the best technology mutual funds 2023 to be a part of India’s growth story.
Invest with Navi Mutual Fund to capture the growth of diverse sectors including the international market at an extremely low cost. Start investing with as low as Rs.10!
Disclaimer: Mutual Fund investments are subject to market risks; read all scheme-related documents carefully before investing.
FAQs
There is no such thing as the best time to invest in mutual funds. Individuals can invest in mutual funds whenever they want. However, it is always preferable to purchase the funds at a lower NAV rather than a higher price. It will not only maximize your returns but will also result in more significant wealth accumulation.
PPFAS MF is India’s fastest-growing major mutual fund house. PPFAS had the highest AUM growth among the top 30 AMCs in FY 2021, at 178 percent. Its AUM increased from Rs 3,138 crore to Rs 8,720 crore during the fiscal year.
Many debt mutual fund managers are concerned about the Union Budget 2022. They believe that a larger-than-expected fiscal deficit and increased borrowing will pressure the bond market and shortly reduce the returns from debt mutual funds.
The 9:30 a.m. to 10:30 a.m. Eastern time (ET) period is frequently one of the best hours of the day for day trading, with the most significant moves occurring in the shortest amount of time.
The vast majority of mutual funds are liquid investments, which can be withdrawn at any time.
Some of the best tech mutual funds in India are:
1. ABSL Digital India Fund
2.Franklin India Technology Fund
3. ICICI Prudential Technology Fund
4. SBI Technology Opportunities Fund
5. Tata Digital India Fund.
A technology mutual fund is a scheme that invests in companies specialising in technology. This provides investors an opportunity for a diversified exposure into the dynamic tech industry.
The future of technology mutual funds in India looks bright, as we continue to grow as a hub for innovation and digital transformation. With increasing demand for cutting-edge technology, digitisation, and the overall growth of the tech sector, technology mutual funds present a unique opportunity to tap into the growth of this booming industry.
Technology mutual funds come with very high risk. This is because they invest in only one sector, keeping the diversification limited shares within that sector. Any downturn that affects the tech sector in particular can have a massive impact on your holdings. Thus, the top technology mutual funds are suitable for investors with a high risk appetite.
Want to put your savings into action and kick-start your investment journey 💸 But don’t have time to do research? Invest now with Navi Nifty 50 Index Fund, sit back, and earn from the top 50 companies.
Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
