Top 3 Flexi Cap Equity Mutual Funds Worth Investing In Based On 5-Year Returns, Ratings

The present uncertainty due to the new Covid variant and extreme volatility in the equity markets of late has not discouraged investors from putting in their bets on mutual fund schemes. In fact, month on month, the inflows into the asset category has been rising. For November month net inflows into equity funds more than doubled sequentially. Also, at the same time, MF SIP accounts registered an increase with more inflow through this mode. Within the equity category, flexi cap netted the highest inflow to the tune of Rs. 2660 crore, followed by large cap funds. So, if you are keen to know about this equity fund category and why investors are aggressively lapping it up, here's all:

What are flexi cap mutual funds?

This equity mutual fund category has come through of late with no restriction on portfolio allocation in any of the cash market segments. SEBI mandates the fund category to deploy a minimum 65% of the corpus in equity and equity-oriented securities. Nevertheless, there is no cap on how much the fund needs to put across large, mid and small caps.

Note, in case of multi-cap funds there is a limitation that the fund needs to put at least 25% across each of the large, mid and small cap stocks. This mandate has been enforced for multi-cap funds such that they are true to label. 

Why are investors aggressively lapping up flexi-cap equity funds?

Investors who are comfortable going by the fund manager's call or outlook and seek more flexibility with their investments choose flexi cap funds. The category gives fund managers the flexibility to change allocation across m-cap based on market dynamics. So, in a bull case scenario, they will be more tilted towards mid and small-caps, while in the bearish market they will reduce exposure to the mid and small-caps and instead move funds to large cap to limit the downside risk.

Now, in the bull run that extended almost 18-19 months, taking Nifty to top 18600 levels, flexi-cap funds that are more large-cap oriented missed on the extra-returns owing to sharp gains on the mid-cap and small-cap scrips. Likewise, the category has been surpassed by multi-cap funds in 2021.

Top 3 Flexi-cap funds based on 5-year returns

So, if you also wish to tap this equity mutual fund category (flexi cap equity mutual funds), here is provided the list of flexi cap funds worth investing in with the highest 5-year returns.

Flexi cap mutual fund	Rating	5-year Annualised returns	5-year Annualised SIP returns	Value of Rs. 10000 monthly SIP started 5 years ago
Parag Parikh Flexi cap	5-Star rating by Value Research	23.37%	28.22%	Rs. 11.96 lakhs
PGIM India Flexi Cap	5-Star rating by both Value Research and CRISIL	21.74%	26.42%	Rs. 11.45 lakhs
UTI Flexi Cap Fund	5-Star rating by both Value Research and CRISIL	20.99%	24.46%	Rs. 10.93 lakhs

Disclaimer:

Mutual Fund investing is subject to market risks. One should exercise caution and invest only if he or she is able to bear losses. The above article is for information purposes only. Neither the author nor Greynium Information Technologies would be responsible for losses incurred on decisions based on this article. Please be careful and consult an advisor before investing.