Some funds run the risk of eroding your capital!!

Thematic funds

Thematic funds invest in a theme rather than in a single sector. So while the fund manager's investment options remained restricted to the theme, he still has several sectors to choose from within that theme. A theme like infrastructure for instance, has several related sectors like cement, steel, capital goods/engineering.
When it comes to stock-picking, this gives the fund manager more flexibility when he is managing a thematic fund as compared to a sector fund. However, that is not to say that thematic funds make prudent investments. At the end of the day, a theme imposes a restriction on the fund manager and goes against the principle of diversification, the cornerstone of mutual fund investing.

We can't think of a single theme that is so enduring that it will make the fund manager forget every other theme till the time that fund is in existence. When that theme runs out of steam (and it will some day!), the fund manager will wish he was managing a 'true blue' diversified equity fund. The investor will certainly wish for that, even if the fund manager doesn't!
Your diversified equity fund manager will in all likelihood be upto the task of identifying the theme, and the good thing for you is that he will also be able to exit from the theme when it fizzles out. Unfortunately, the 'thematic' fund manager will not have the same luxury.