Nippon India Banking & Financial Services Fund - IDCW Option

Nippon India Banking & Financial Services Fund - IDCW Option ranks among the stronger performers in the Sectoral category, backed by a 4-star rating. Consistent 3-year performance combined with a strong rating makes this one of the more credible options in its space. TopFund's composite Health Score, which weighs rating, 3-year CAGR, expense ratio and fund size, puts it at 82/100.

Cost: At 1.06%, the expense ratio is roughly in line with the Sectoral category average of 1.05% — cost isn't a standout factor either way for this fund.

Risk-adjusted performance: Over the trailing 1-year period, the fund shows a negative Sharpe ratio of -0.1 — over the past year, returns haven't kept pace with the volatility involved, even before accounting for the risk-free rate. Separately, with 88.55% annualised volatility, this is among the more turbulent funds in its space — expect sharp swings in both directions.

Who should invest: This fund is best suited to investors whose goals and risk appetite align with a Equity fund. Given the Very High risk rating, this fund is not suited to short-term goals or investors who may need to exit within 2-3 years.