SBI Technology Opportunities Fund – Direct Growth

SBI Mutual Fund offers a mutual fund scheme specialised in the technology sector called the SBI Technology Opportunities Fund-Growth. This fund was established on July 14, 1999, and is now managed by fund managers Saurabh Pant and Mohit Jain.

By purchasing a diverse portfolio of equities and equity-linked securities issued by technology and technology-related firms, the SBI Technology Prospects Fund hopes to offer investors with opportunities for long-term capital gain. At least 80% of the fund is put towards equities of tech and tech-related firms.

Up to 20% of the SBI Technology Opportunities Fund’s assets may be invested in non-technology-related shares, debt, or money market instruments. The fund uses a bottom-up strategy to identify and invest in firms that stand to profit from technological innovation.

Pros & Cons

Who should invest in SBI Technology Opportunities Fund?

One of the fastest-growing industries in recent years has been IT, and almost every major IT company in the world now has a presence in India. The technology industry is a rapidly expanding market that has attracted a lot of investors in recent years which makes this fund a lucrative choice.

• Investors with a 5-7 year time horizon are good fits for the SBI Technology Opportunities Fund.
• If you have a high-risk tolerance, you should consider investing in this fund. The volatility of technology funds is greater than that of diversified funds
• Investors with an in-depth understanding of macro trends who are willing to gamble strategically in pursuit of superior returns relative to other Equity funds. Even if the market as a whole is doing well, these investors should nevertheless be prepared for the risk of moderate to severe losses in their assets.
• For any investment to be successful, you must be willing to commit to the market for the long haul. Experts in Technology Funds do not recommend investing for the short term.

What are the benefits of investing in the SBI Technology Opportunities Fund?

The fund makes investments in the creation of high-impact technologies that may be utilised by businesses around the world to enhance their infrastructure, products, and services. It focuses on artificial intelligence (AI), robots, data science, and blockchain technologies.

• Profit-to-Risk Ratio Very High

Since technology is one of the fastest-growing sectors, technology funds aim to outperform equities funds by maintaining a high allocation to that sector. All Sectoral Funds aim to outperform diversified funds by investing primarily in a single, high-growth industry. The fund’s returns might take a significant hit if this viewpoint fails, but it could outperform the market and other equities funds if the underlying industry thrives. As a result, the potential benefits outweigh the risks.

• Capitalization-Wide Market Investment

While the emphasis is on a certain industry, it is not restricted to a specific market cap. Its primary focus is on investing in the stock of technology-related companies, while it makes investments in the stocks of businesses of all sizes. Whether a scheme or AMC invests a large portion of its funds in a single market cap or maintains a broadly diversified portfolio is a matter of discretion.

• Steady Performance

As with any Sectoral Fund, the Technology Fund focuses on a single industry. There is not much variety available. All sectors experience market cycles and perform correspondingly, and when a sector is expanding, funds that concentrate on growth sectors provide the highest returns and increase the margin over the benchmark and other mutual funds. Over the years, the technology industry has delivered steady performance.