Equity mutual funds had a tough FY26, with systematic investment plans (SIPs) in several schemes losing up to 48%. Technology and small‑cap funds were the worst performers, dragging down investor returns. Many investors who stayed disciplined with monthly SIPs saw their portfolios shrink sharply, raising concerns about sector‑focused investing.
On the other hand, international funds delivered positive gains, proving that diversification across geographies can protect wealth. Broader Indian equity funds also fared better than narrow thematic ones. Experts caution that chasing short‑term rallies in sectors like IT or small‑caps can expose investors to high volatility and deep losses.
For FY27, advisors recommend a balanced approach. Instead of concentrating on niche themes, investors should spread their money across diversified equity funds, large‑cap schemes, and global opportunities. This strategy reduces risk and builds resilience against market swings.
The lesson from FY26 is clear: SIPs work best when combined with diversification. Blindly following trends or sectoral hype can erode wealth, while disciplined investing in broad‑based funds ensures stability. Investors should review their portfolios, cut exposure to risky themes, and focus on sustainable growth.
Equity investing remains a long‑term game, and smart diversification is the key to safer gains in the coming year.
