Pharma and healthcare funds have risen 11.73 per cent over the past three months. There are several reasons for this. Whenever the domestic economy is not doing well, smart money shifts to export-oriented sectors like pharma. Moreover, the US business of pharma majors is stabilising. Many companies have started to get approvals on their complex generics and speciality drugs. Indian players have also got better at complying with US Food and Drug Administration (USFDA) norms. While the fundamentals are improving, these are sector-specific funds, hence allocation to them should not exceed 10 per cent of your equity portfolio. Invest with a horizon of at least five years.