Flexi cap mutual funds have emerged as one of investors’ favourite categories, with assets under management (AUM) nearing the Rs 5 lakh crore mark in August, according to the monthly data released by the Association of Mutual Funds in India (AMFI). A market expert believes this reflects investors’ confidence in the flexibility offered by these funds.
“With flexi cap funds' assets under management nearing Rs 5 lakh crore, investor confidence in their flexibility is at an all-time high. In today's volatile market, investors appreciate managers who can allocate dynamically across large-cap, mid-cap, and small-cap stocks,” Rajesh Minocha, Certified Financial Planner (CFP) and Founder of Financial Radiance, told ETMutualFunds.
Also Read | Quant Mid Cap Fund exits Bharat Forge & 2 others, trims exposure in Ajanta Pharma in August
AMFI’s monthly data shows that the AUM of flexi cap mutual funds witnessed a marginal rise of 0.45% on a monthly basis—from Rs 4.93 lakh crore in July to Rs 4.95 lakh crore in August. On a yearly basis, the AUM of flexi cap funds surged 15% from Rs 4.29 lakh crore in August 2024.
The total AUM of these funds is the second highest among the 11 sub-categories under equity mutual funds. Sectoral and thematic funds have the highest AUM at Rs 5.06 lakh crore as of August 31, 2025.
With these funds gaining investors’ interest and nearing the total asset size of sectoral and thematic funds, are they becoming overcrowded? The expert says that despite rapid growth, these funds remain diversified by mandate.
“Despite rapid growth, flexi cap funds remain diversified by mandate. They face less concentration risk than sectoral or thematic funds, as managers allocate across segments based on valuations,” said Minocha.
On the inflow front, flexi cap funds received an inflow of Rs 7,679 crore in August, the highest among the 11 equity mutual fund sub-categories.
In the current calendar year, flexi cap funds have received a total inflow of Rs 46,866 crore. Out of eight months in 2025, they recorded the highest inflows in nearly five months.
In the current financial year (April to August), flexi cap funds received total inflows of Rs 30,449 crore.
There are currently 40 flexi cap funds, of which 14 received inflows on a monthly basis while 26 saw outflows. Parag Parikh Flexi Cap Fund and HDFC Flexi Cap Fund received Rs 1,759 crore and Rs 1,293 crore inflows respectively in August.
Also Read | Mutual fund investors face losses in 74% of equity schemes on 1 year lumpsum investments
Tata Flexi Cap Fund received the lowest positive inflow of Rs 5.53 crore in the same period. Quant Flexi Cap Fund saw the highest outflow of Rs 324 crore in August, followed by Axis Flexi Cap Fund with an outflow of Rs 287 crore. Shriram Flexi Cap Fund recorded the lowest outflow at Rs 3.31 crore in August.
Should flexi cap funds remain a core holding in portfolios for long-term goals? According to the expert, to maximise portfolio resilience, investors should consider making flexi cap funds a core holding in their long-term strategy and reassess allocations to ensure substantial exposure to flexi cap, large & mid-cap, and multi-cap funds that empower managers to adapt to changing markets.
On average, flexi cap funds lost around 0.47% in August. Out of 40 funds in the category, 14 delivered positive returns, 25 delivered negative returns, and one failed to generate a return.
ICICI Pru Flexi Cap Fund offered the highest return of 1.69% in August. Parag Parikh Flexi Cap Fund, the largest fund in the category by assets, posted a negative return of 0.33%. Samco Flexi Cap Fund lost the most, at around 3.80%.
Looking at the performance, the expert believes flexi cap funds are well-positioned for growth. With India’s strong structural growth prospects, their dynamic allocation strikes a balance between wealth creation and risk management.
As per the latest AMFI data, flexi cap funds had nearly 1.98 crore folios in August compared to 1.94 crore folios in July.
According to Sebi’s mandate, flexi cap funds must invest at least 65% of total assets in equity and equity-related instruments. These are open-ended dynamic equity schemes that invest across large-cap, mid-cap, and small-cap stocks without the rigid allocation rules of other categories.
Also Read | Motilal Oswal Midcap Fund adds Eternal, hikes stake in Paytm and 12 other stocks in August
Flexi cap mutual funds give managers the freedom to invest across market capitalisations and sectors/themes, allowing them to position portfolios based on their market outlook.
According to a report by ETBureau, flexi cap funds are suited for long-term equity investors or first-timers with a moderate risk appetite who want exposure to Indian equities without the hassle of picking individual stocks.
“They work well as a core portfolio holding for those seeking just one diversified fund where the manager decides the mix across large-, mid- and small-caps to balance risk and volatility. Investors planning to build wealth steadily through systematic investment plans (SIPs) can also consider this category,” ETBureau said.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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“With flexi cap funds' assets under management nearing Rs 5 lakh crore, investor confidence in their flexibility is at an all-time high. In today's volatile market, investors appreciate managers who can allocate dynamically across large-cap, mid-cap, and small-cap stocks,” Rajesh Minocha, Certified Financial Planner (CFP) and Founder of Financial Radiance, told ETMutualFunds.
Also Read | Quant Mid Cap Fund exits Bharat Forge & 2 others, trims exposure in Ajanta Pharma in August
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The total AUM of these funds is the second highest among the 11 sub-categories under equity mutual funds. Sectoral and thematic funds have the highest AUM at Rs 5.06 lakh crore as of August 31, 2025.
With these funds gaining investors’ interest and nearing the total asset size of sectoral and thematic funds, are they becoming overcrowded? The expert says that despite rapid growth, these funds remain diversified by mandate.
“Despite rapid growth, flexi cap funds remain diversified by mandate. They face less concentration risk than sectoral or thematic funds, as managers allocate across segments based on valuations,” said Minocha.
On the inflow front, flexi cap funds received an inflow of Rs 7,679 crore in August, the highest among the 11 equity mutual fund sub-categories.
In the current calendar year, flexi cap funds have received a total inflow of Rs 46,866 crore. Out of eight months in 2025, they recorded the highest inflows in nearly five months.
In the current financial year (April to August), flexi cap funds received total inflows of Rs 30,449 crore.
There are currently 40 flexi cap funds, of which 14 received inflows on a monthly basis while 26 saw outflows. Parag Parikh Flexi Cap Fund and HDFC Flexi Cap Fund received Rs 1,759 crore and Rs 1,293 crore inflows respectively in August.
Also Read | Mutual fund investors face losses in 74% of equity schemes on 1 year lumpsum investments
Tata Flexi Cap Fund received the lowest positive inflow of Rs 5.53 crore in the same period. Quant Flexi Cap Fund saw the highest outflow of Rs 324 crore in August, followed by Axis Flexi Cap Fund with an outflow of Rs 287 crore. Shriram Flexi Cap Fund recorded the lowest outflow at Rs 3.31 crore in August.
Should flexi cap funds remain a core holding in portfolios for long-term goals? According to the expert, to maximise portfolio resilience, investors should consider making flexi cap funds a core holding in their long-term strategy and reassess allocations to ensure substantial exposure to flexi cap, large & mid-cap, and multi-cap funds that empower managers to adapt to changing markets.
On average, flexi cap funds lost around 0.47% in August. Out of 40 funds in the category, 14 delivered positive returns, 25 delivered negative returns, and one failed to generate a return.
ICICI Pru Flexi Cap Fund offered the highest return of 1.69% in August. Parag Parikh Flexi Cap Fund, the largest fund in the category by assets, posted a negative return of 0.33%. Samco Flexi Cap Fund lost the most, at around 3.80%.
Looking at the performance, the expert believes flexi cap funds are well-positioned for growth. With India’s strong structural growth prospects, their dynamic allocation strikes a balance between wealth creation and risk management.
As per the latest AMFI data, flexi cap funds had nearly 1.98 crore folios in August compared to 1.94 crore folios in July.
According to Sebi’s mandate, flexi cap funds must invest at least 65% of total assets in equity and equity-related instruments. These are open-ended dynamic equity schemes that invest across large-cap, mid-cap, and small-cap stocks without the rigid allocation rules of other categories.
Also Read | Motilal Oswal Midcap Fund adds Eternal, hikes stake in Paytm and 12 other stocks in August
Flexi cap mutual funds give managers the freedom to invest across market capitalisations and sectors/themes, allowing them to position portfolios based on their market outlook.
According to a report by ETBureau, flexi cap funds are suited for long-term equity investors or first-timers with a moderate risk appetite who want exposure to Indian equities without the hassle of picking individual stocks.
“They work well as a core portfolio holding for those seeking just one diversified fund where the manager decides the mix across large-, mid- and small-caps to balance risk and volatility. Investors planning to build wealth steadily through systematic investment plans (SIPs) can also consider this category,” ETBureau said.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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