How you should bet on FMCG funds to tap into the last defensive sector

Stellar past returns of FMCG sector funds make them an attractive bet. But your investment in these funds should be limited and the time horizon should be long

If you look at the trailing returns of sector funds belonging to the fast-moving consumer goods (FMCG) sector, they are remarkably attractive (see table). Turn to the year-wise performance and they are equally eye-catching: These funds have given positive returns every year except 2008. With the information technology and pharma sectors faltering in recent times, FMCG remains the last defensive in which investors can seek refuge when the markets turn turbulent. 

Several factors are responsible for the stellar performance of FMCG funds. "Consistent earnings growth relative to the broader market has been the biggest driver for the FMCG sector so