Best Mutual Funds: These 5 Flexi Cap Schemes Delivered Over 20% Returns in the Past Five Years – Do You Own Any?
Best Mutual Funds: Investing in mutual funds is one of the most popular ways for individuals to grow their wealth. Before investing, most investors assess the past returns of a mutual fund to gauge its performance. While past returns provide insights into a fund’s potential, they do not guarantee future success. Along with historical returns, investors should consider other crucial factors such as the category of the fund, the reputation of the fund house, whether the scheme is actively or passively managed, and the current market conditions.
One of the most versatile categories in mutual funds is the Flexi Cap Mutual Fund. These funds offer a unique advantage by allowing fund managers the freedom to invest across large-cap, mid-cap, and small-cap stocks without any rigid allocation constraints. This flexibility helps in navigating changing market dynamics effectively.
If you are looking for top-performing mutual funds that have delivered impressive returns over the past five years, here are the five best Flexi Cap mutual fund schemes that have generated over 20% annualized returns.
What Are Flexi Cap Mutual Funds?
Flexi Cap mutual funds are equity-oriented schemes that invest at least 65% of their assets in equity and equity-related instruments. Unlike multi-cap funds, which are mandated to maintain a minimum of 25% exposure in large-cap, mid-cap, and small-cap stocks each, Flexi Cap funds give fund managers complete discretion to allocate funds based on market opportunities.
The flexibility to move across market capitalizations allows these funds to adjust their portfolio dynamically, potentially maximizing returns while mitigating risks.
Top 5 Flexi Cap Mutual Funds with Over 20% Returns
Here’s a look at the top-performing Flexi Cap mutual funds based on their five-year annualized returns:
| Flexi Cap Fund | 5-Year Return (%) | AUM (₹ Crore) |
|---|---|---|
| Quant Flexi Cap Fund | 29.73% | ₹6,831.14 Cr |
| Parag Parikh Flexi Cap Fund | 23.44% | ₹90,681.07 Cr |
| HDFC Flexi Cap Fund | 22.45% | ₹67,038.96 Cr |
| JM Flexicap Fund | 22.08% | ₹5,363.85 Cr |
| Franklin India Flexi Cap Fund | 20.51% | ₹17,343.70 Cr |
Key Highlights from the List:
- Top Performer: Quant Flexi Cap Fund led the pack with an impressive 29.73% return over five years.
- Largest Fund: Parag Parikh Flexi Cap Fund holds the largest AUM of ₹90,681 crore, reflecting strong investor confidence.
- Consistent Growth: HDFC Flexi Cap Fund and JM Flexicap Fund have also delivered steady returns, exceeding 22% annually.
- Franklin India Flexi Cap Fund: Although at the bottom of this top 5 list, it still managed an impressive 20.51% return.
Why Invest in Flexi Cap Funds?
✅ Diversification Across Market Caps:
Flexi Cap funds have the liberty to invest in large-cap stability, mid-cap growth potential, and small-cap high-return opportunities.
✅ Active Fund Management:
Fund managers can rebalance the portfolio based on prevailing market conditions, enhancing potential returns.
✅ Long-Term Growth Potential:
Since these funds can adjust to different market phases, they offer better risk-adjusted returns over the long term.
Financial Ratios to Consider Before Investing
Before selecting a Flexi Cap mutual fund, it is crucial to evaluate key financial ratios to understand their risk and return profile:
| Fund Name | Expense Ratio (%) | Beta (Risk Level) | Sharpe Ratio (Risk-Adjusted Return) | Standard Deviation (Volatility) |
|---|---|---|---|---|
| Quant Flexi Cap Fund | 0.66 | 1.05 | 1.38 | 18.56 |
| Parag Parikh Flexi Cap Fund | 0.76 | 0.89 | 1.22 | 14.72 |
| HDFC Flexi Cap Fund | 1.08 | 1.12 | 1.11 | 17.45 |
| JM Flexicap Fund | 1.29 | 1.15 | 1.05 | 16.90 |
| Franklin India Flexi Cap Fund | 0.95 | 1.07 | 1.14 | 15.85 |
Key Takeaways from Financial Ratios:
- Lower Expense Ratio = Higher Net Returns: Quant Flexi Cap Fund has the lowest expense ratio (0.66%), making it more cost-efficient.
- Beta Measures Risk: A beta higher than 1 indicates higher market sensitivity. HDFC Flexi Cap Fund has the highest beta (1.12), suggesting greater volatility.
- Sharpe Ratio Evaluates Risk-Adjusted Returns: A higher Sharpe ratio signifies better risk-adjusted returns. Quant Flexi Cap Fund leads with a Sharpe Ratio of 1.38.
- Standard Deviation Shows Volatility: Lower standard deviation means lower fluctuations. Parag Parikh Flexi Cap Fund is the least volatile (14.72% SD).
Should You Invest in These Funds?
While past performance is an important metric, investors should not base their decisions solely on historical returns. Market conditions, interest rates, and global economic scenarios constantly change, affecting future performance.
Points to Consider Before Investing:
✔️ Investment Horizon – Flexi Cap funds are best suited for long-term investors with a horizon of at least 5-7 years.
✔️ Risk Tolerance – Since these funds invest across market caps, they come with moderate to high risk.
✔️ Fund Manager’s Track Record – A skilled fund manager can make a significant difference in fund performance.
✔️ Market Conditions – Ensure that the current valuation levels align with your financial goals.
Final Thoughts
Flexi Cap mutual funds offer a well-balanced investment opportunity by dynamically investing across market capitalizations. The above-listed five Flexi Cap funds have generated over 20% annualized returns in the past five years, making them attractive choices for investors seeking growth.
However, investors should conduct thorough research, analyze financial ratios, and consider their risk appetite before making any investment decisions. Past performance does not guarantee future results, so a diversified approach is always recommended.
Are you already investing in any of these funds? If not, would you consider adding them to your portfolio? Share your thoughts in the comments below!
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.