6 flexi cap mutual funds gave highest returns in the past ten years. Should you invest?

livemint.com:

The continued market turmoil has prompted many investors to think if it is worth investing in funds categorized under a particular market cap or investing in stocks dedicated to a particular sector or theme. The fact that some sectors have performed beyond expectations while others have sunk much below than anticipated has caused many investors to now switch to flexi-cap funds.

For the unversed, flexi-cap funds fall in the category of equity-focused funds. These funds fall under the category of equity mutual funds, and they have the flexibility to invest in companies of varying market capitalizations, spanning from large-cap to small-cap. While they are required to allocate a minimum of 65 per cent of their assets to equity and equity-related instruments, there are no constraints regarding the upper or lower limits of their exposure to different market capitalizations. This flexibility empowers fund managers to adapt their portfolios to align with their investment perspectives.

To illustrate, in times of market volatility, a manager overseeing a flexi-cap fund may opt to increase their allocation to large-cap stocks. However, when they identify potential growth prospects, they can seamlessly transition their investments towards mid-cap or small-cap stocks. Based on prevailing market conditions, liquidity factors, and valuation evaluations, fund managers can readily make choices regarding their investments across different market capitalization categories. This adaptability often leads to flexi-cap funds delivering superior performance compared to other categories of equity funds over extended periods.

It’s important to note that flexi-cap funds are not immune to market risk. Consequently, their performance can fluctuate,