Thematic have seen a sharp divergence in performance in 2026, with some categories delivering double-digit gains while others have fallen sharply.
Data from Vallum Capital Advisors’ latest report titled “Vallum Cross-Asset Macro Grid” shows that defence, healthcare, special opportunity, commodities and innovation were among the top-performing thematic categories in 2026 so far.
For mutual fund investors, the data highlights how returns within the thematic-fund universe have varied significantly depending on the chosen. The report uses median category performance, rather than the return of a single mutual fund scheme.
Which thematic mutual fund categories led in 2026?
| Thematic fund categories | 2026 category returns |
| Defence | 25.8% |
| Healthcare | 17.2% |
| IPO | 15.0% |
| Innovation | 10.1% |
| Manufacturing | 8.3% |
*Source: Vallum Capital Advisors, Returns as on 15 September 2026
Defence funds have delivered the strongest median performance among the thematic categories, gaining 25.8% in 2026 so far. Healthcare follows with a 17.2% return, while IPO-themed funds have gained 15%.
Innovation and Manufacturing complete the top five, with returns of 10.1% and 8.3%, respectively.
Which thematic mutual fund categories are at the bottom?
| Thematic fund categories | 2026 category returns |
| Railways | -22.4% |
| Technology | -16.5% |
| Sector Leaders | -7.0% |
| ESG | -5.0% |
| Consumption | -4.0% |
*Source: Vallum Capital Advisors, Returns as on 15 September 2026
Railways have recorded the steepest decline among the categories, falling 22.4% in 2026 so far. Technology follows with a 16.5% decline.
Sector Leaders, ESG and Consumption have also remained in negative territory, declining 7%, 5% and 4%, respectively.
The gap between Defence, the top-performing category, and Railways, the weakest, stands at 48.2 percentage points.
What does the latest one-month data show?
The recent one-month numbers show a much narrower set of positive performers.
| Thematic fund categories | 1-month category returns |
| IPO | 2.2% |
| Defence | 1.4% |
*Source: Vallum Capital Advisors, Returns as on 15 September 2026
Among the five categories that have led in 2026 so far, IPO and Defence were the only two categories among the 2026 top five to deliver positive returns over the latest one-month period. IPO-themed funds led with a 2.2% median gain, followed by Defence at 1.4%.
Healthcare, Innovation and Manufacturing, despite being among the leading categories on a 2026 basis, posted negative returns over the latest month.
Which thematic fund categories lead in five-year returns?
| Thematic fund categories | 5-year category returns |
| PSU | 22.6% |
| Transportation and Logistics | 20.9% |
| Infrastructure | 18.8% |
| Special Opportunity | 18.1% |
| Manufacturing | 17.4% |
*Source: Vallum Capital Advisors, CAGR as on 15 September 2026
Over the longer five-year period, all the thematic categories delivered positive returns. PSU and Transportation & Logistics were among the strongest performers, with returns of 22.6% and 20.9%, respectively.
For mutual fund investors, the data provides a snapshot of how different themes have performed across different time frames.
Disclaimer: This is purely for educational/informational purposes and should not be taken as any sort of investment advice. Always consult a SEBI-registered advisor before making any investment decisions.