Flexi-cap funds are equity mutual funds that provide fund managers with flexibility to invest across large-cap, mid-cap, and small-cap stocks. According to reports from Mint, under Securities and Exchange Board of India (Sebi) rules, flexi-cap funds are required to invest at least 65% of their assets in equity and equity-related instruments. Beyond this minimum requirement, fund managers can decide how to distribute the portfolio across market-cap segments, creating significant variation between different funds within the same category.
According to Value Research data as reported by Mint, Parag Parikh Flexi Cap Fund emerged as the fund with the highest large-cap allocation at 91.14%. This allocation is substantially above the category average of 58.41%. Franklin India Flexi Cap Fund followed with a large-cap allocation of 76.87%, while HDFC Flexi Cap Fund maintained 75.69% in large-cap stocks. The remaining top 10 funds by AUM showed varying degrees of large-cap exposure, with Canara Robeco Flexi Cap Fund at 74.69% and Kotak Flexi Cap Fund at 73.18%.
At the opposite end of the spectrum, Motilal Oswal Flexi Cap Fund recorded the lowest large-cap allocation among the top 10 funds by AUM at 37.79%, which is approximately 20.6 percentage points below the category average. ABSL Flexi Cap Fund also maintained a below-average allocation at 56.61%, while UTI Flexi Cap Fund and SBI Flexicap Fund were only slightly above the category average. ICICI Prudential Flexicap Fund was positioned closest to the middle with 65.23% in large-cap stocks, still maintaining a higher allocation than the category average.
As reported by Mint, the variation in large-cap allocation highlights an important distinction within the flexi-cap category. For investors comparing flexi-cap funds, the large-cap allocation provides a key metric to understand how a fund is positioned relative to its peers. The data suggests that while these funds have flexibility to move across market-cap segments, their actual portfolios can remain tilted towards a particular segment. This information becomes particularly relevant when assessing potential overlap with an existing large-cap portfolio for investors who already hold large-cap funds.
