In January 2008, I had invested Rs 25,000 in UTI Infrastructure. But this fund has not been performing well. What should I do with my investments?
V Ramakrishna, Chennai
The stated objective of this fund is to invest in companies engaged either directly or indirectly in the infrastructure growth of the Indian economy. It is a thematic or sector fund in which you should invest only to fill any gap in allocation to the sector in the overall portfolio allocation of your investments. However, you appear to be a first time investor when you had invested in this fund to catch the infrastructure theme as a rally in the 2004-8 stock market rallies. Ideally, you should invest in a well diversified mutual fund across sectors and companies to gain from the overall rise in stock markets. Yes, over the period that you mention, compared to several other funds, this one’s performance pales. Moreover, you invested in this fund just as the markets were touching the peak of the bull run, which followed a massive crash. The lesson for you from this experience is to regularly review the performance of the funds that you invest in so that you can make the necessary changes to fund selection when required. Kill your emotions and cut your losses by exiting this fund and instead invest in a diversified equity fund.
