Flexi-Cap Funds: Risk Differences in ₹5.02 Lakh Crore AUM

Flexi-cap mutual funds, despite their shared category, exhibit substantial variations in portfolio allocation across large-, mid-, and small-cap stocks. A July 2026 study of 22 flexi-cap funds, collectively managing ₹5.02 lakh crore in assets, highlighted diverse market-cap and asset allocation strategies, indicating varied risk profiles.

The category’s median allocation stood at 63.1% in large-cap stocks, 20.2% in mid-caps, and 17.1% in small-caps. However, individual funds significantly deviated from these averages.

Market-Cap Allocations Reveal Disparity

• The Parag Parikh Flexi Cap Fund (PPFAS) committed 91% of its equity portfolio to large-cap stocks.
• Franklin, HDFC, and Quant also showed high large-cap exposure at 76.9%, 75.7%, and 75.5%, respectively.
• Capitalmind led mid-cap exposure with 40.6%, followed by Motilal Oswal at 36%.
• In the small-cap segment, Old Bridge recorded the highest allocation at 52.3%.
• Bank of India, Capitalmind, and Abakkus also had significant small-cap exposure at 33.7%, 33%, and 31.4%.

Beyond market capitalization, notable differences emerged in equity, debt, and cash allocations among these funds. This further underscores the flexibility fund managers employ.

Equity, Debt, and Cash Holdings Diverge

• JioBlackRock reported the highest equity allocation at 99.4%.
• Quant maintained a substantial debt allocation of 22.3%, considerably above the category median of 3.4%.
• Franklin held the highest cash allocation among the funds at 5.1%.

These variations highlight the inherent flexibility within the flexi-cap category, enabling fund managers to adapt portfolios based on evolving market conditions. Consequently, a fund concentrated in large-caps will present a distinct risk-return profile compared to one with significant mid- or small-cap exposure.

Investors are advised to meticulously analyze a fund’s strategy, asset allocation, personal risk tolerance, and investment horizon. Allocations are dynamic and can change over time, necessitating continuous review.