Sir/Madam The real story of mine. I passed 12th science with 70% JEE mains 2025 got 43 percentile Now taking a drop with preparation for JEE MAINS 2026 at PW As per my marks % 70 in 12th my father telling me not to take take a drop year and to join ITER BBSR IN BTECH CSE . COURSE. I couldn't decide what to do.please suggest me whether I will take improvement exam in 12 th for 75% taking a drop for JEE MAINS 2026 preparation.pls

Ans: You are looking at the IT sector after a phase of underperformance. That itself is a sensible thought process. Many quality IT companies are trading below their earlier peak valuations. Long-term opportunities may emerge if earnings growth improves.

» My Assessment On Sector-Based Investing

– An IT-focused fund is a sector fund.

– Sector funds can deliver strong returns during favourable cycles.

– But they can also remain stagnant for several years.

– Returns depend heavily on one industry.

– If global technology spending slows, performance may suffer.

– US economic growth, interest rates and technology budgets also influence results.

– Hence, sector funds carry higher risk than diversified equity funds.

» Why I Am Not A Big Fan Of Index Funds

– Index funds invest purely based on index weightage.

– No fund manager can avoid expensive stocks.

– No flexibility to move away from weak companies.

– No opportunity to increase allocation to emerging winners.

– The fund simply follows the index, whether markets are attractive or expensive.

– During market corrections, there is no active risk management.

– Investors get average market performance, not better-than-market performance.

– In concentrated sectors like IT, this limitation becomes even more important.

» Benefits Of Actively Managed Funds

– Experienced fund managers can identify future leaders early.

– They can reduce exposure to companies facing business challenges.

– They can manage sector allocation based on opportunities.

– They can maintain cash when valuations become excessive.

– They can take advantage of changing market conditions.

– Over long periods, good active funds have often created meaningful alpha over benchmarks.

» Should You Invest Now?

– If your existing portfolio already has adequate exposure to diversified equity funds, a small allocation to the IT sector may be considered.

– However, making a large investment into a single sector may not be prudent.

– For most investors, diversified actively managed equity funds remain a better core strategy.

– Sector exposure should generally remain a satellite allocation and not the foundation of wealth creation.

Regularly:

– Review your overall asset allocation first.

– Check existing exposure to technology stocks through mutual funds.

– Assess your investment horizon. Ideally 7+ years for sector funds.

– Avoid investing based on recent performance alone.

– Use staggered investments instead of deploying a large lump sum at one time.

– Keep the majority of equity allocation in diversified actively managed funds.

» Final Insights

– The IT sector may offer opportunities over the long term.

– However, a sector-based index fund carries concentration risk and lacks active management flexibility.

– For most investors, diversified actively managed equity funds remain a stronger and more balanced wealth creation option.

– If you want IT exposure, keep it limited and supplementary rather than making it a major portfolio holding.

Best Regards,

K. Ramalingam, MBA, CFP,

AMFI-Registered MFD – ARN 4188

www.holisticinvestment.in

https://www.linkedin.com/in/ramalingamcfp/