- Indian investors increasingly favor themes, boosting global asset investments.
- Global themes like AI attract significant Indian investment abroad.
- Thematic investing carries risks; poor timing often reduces returns.
At the start of this decade, the country had around 4 crore demat accounts. By October 2025, that figure had crossed 21 crore. More Indians are investing than ever, and they have stopped buying the market as one block. In the last financial year, nearly three of every four new Equity Fund launches in Indian markets were built around a single sector or theme.
This is a signal that Indian investors are increasingly picking ideas, not just products. That same instinct is now travelling abroad. Under the Liberalised Remittance Scheme, Indian investment into foreign equity and debt rose to roughly USD 1.7 billion, about Rs 14,600 crore, in FY25, a gain of around 12.5 per cent. Total remittances under the scheme fell about 7 per cent over the same year.
Indians sent less abroad overall, yet put more of it into global assets. Some of the biggest global themes are most directly accessible abroad, and the money is starting to follow them. Why themes are attractive Artificial intelligence is the clearest case. In October 2025, Nvidia became the first company in history to touch a USD 5 trillion valuation. That single number sits close to Rs 430 lakh crore, roughly the size of India’s entire listed market.
The four largest US technology firms have guided toward about USD 725 billion of capital spending in 2026, most of it on AI infrastructure, up from USD 410 billion the year before. Spending on that scale does not reverse on a single quarter’s headlines. This is already the largest industrial build-out in the world. Space commercialisation tells the same story. For years, the most valuable space company on earth stayed private, open only to institutions.
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That barrier fell on June 12, 2026, when SpaceX listed on the Nasdaq at a valuation near USD 1.77 trillion. The biggest bet in the space theme moved from private hands to an ownable public ticker. AI at scale, frontier Semiconductors, commercial space, and global biotech are shaping the next decade, and they are thinly represented, sometimes wholly absent, in Indian markets. The investor who wants the theme has to look outward to find it. Owning the theme without chasing it While the instinct is sound, the execution decides the outcome.
In Morningstar’s study of the decade to December 2023, investors in sector and theme funds surrendered more of their funds’ returns than any other category, trailing by about 2.6 percentage points a year. The cause was timing. Money showed up after the theme had run, and left after it had fallen. The safe-looking alternative hides its own wager. By the close of 2025, the seven largest US technology companies made up almost 35 per cent of the S&P 500.
An Indian who buys a plain US Index Fund already holds a heavy, concentrated bet on AI, intended or not. A dedicated theme fund concentrates by design, often holding the bulk of its assets in one theme. That concentration drives both the climb and the drop. The US markets offer the world’s deepest menu of thematic ETFs, a single basket holding dozens of names across an idea rather than one stock carrying the whole bet. You own the theme without having to pick the winner inside it. That is what makes the idea both safer and easier to act on.
A sound portfolio keeps a diversified global core and expresses conviction through a measured satellite: a thematic sleeve large enough to matter, small enough to survive being early. For serious long-term investors, an international allocation of 20 per cent to 30 per cent does this job, reached through US-listed stocks and ETFs that cover both the broad market and the chosen theme. Holding dollar assets carries a structural tailwind too. The rupee has drifted lower against the dollar for years, and the move has accelerated, falling roughly 12 per cent in the twelve months to May 2026 alone.
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The Liberalised Remittance Scheme permits up to USD 250,000 a year. The 20 per cent tax collected at source above Rs 10 lakh can look off-putting, but it is a credit, not a cost: salaried investors set it off against salary TDS within the year, others against advance tax. None of this is the hard part. The hard part is patience. A theme is a decade-long conviction wearing the costume of a hot tip. Indian investors have earned the right to own these ideas. The task now is to hold them like an allocation, not chase them like a headline. Because position sizing, not stock picking, is what turns a good theme into real wealth.
(“Disclaimer: This article uses information originally published by Dalal Street Investment Journal (DSIJ). The views expressed are those of the original authors and not necessarily of ABP Network Pvt. Ltd. This content is provided for general informational and educational purposes only and should not be construed as investment, financial, legal or tax advice. Readers are advised to conduct their own research and/or consult a qualified financial advisor before making any investment decisions. This content is for informational purposes only and should not be treated as investment advice. ABP Network, its employees and associates shall not be responsible or liable for any losses or damages arising directly or indirectly from the use of or reliance on this article or any information contained herein.”)
