Sector specific scheme is the scheme in which you invest in securities of a particular sector or industry which are specified in the offer article.  For example, Pharma, IT, FMCG, oil stocks etc. The profits in these types of funds are built upon the performance of the particular sector/industry. While the funds may offer better returns because they are riskier in comparison with diversified funds. Investors would need to track the performances of that sector/industry and shall exit at right time. They shall seek suggestion of an expert.