The flexi-cap mutual fund category has become the biggest segment in India’s mutual fund industry. As of December 31, 2025, flexi-cap funds manage ₹5.51 lakh crore, making them larger than any equity, debt, hybrid or commodity category.
For comparison, liquid funds, the next largest category, manage about ₹5.03 lakh crore. This shows how strongly investors prefer flexi-cap funds due to their freedom to invest across large, mid and small-cap stocks.
More than half of the flexi-cap money is concentrated in just 3 schemes:
Together, these 3 manage over ₹2.84 lakh crore, or 51% of total flexi-cap AUM.
Source: AMFI
Although they belong to the same category, the three funds follow very different investment styles, giving investors multiple risk-return choices.
Asset Allocation Approach
Parag Parikh follows a conservative and balanced strategy. About 75.56% of its portfolio is in equities, while 20.56% is invested in debt. Small portions are kept in real estate and cash. This helps reduce downside risk.
Sector Positioning
The fund has lower exposure to financials than its peers and higher exposure to technology, including global tech stocks. It is underweight on industrials, FMCG and healthcare, which helps limit domestic cyclical risks.
Top Holdings
Key holdings include HDFC Bank, Power Grid, ICICI Bank, Bajaj Holdings and Kotak Mahindra Bank. Global stocks like Alphabet (Google) also feature prominently.
Performance And Risk
Despite being marked as very high risk, the fund has low volatility and strong downside protection.
Asset Allocation Approach
HDFC Flexi Cap invests aggressively, with 84.47% in equities. Debt exposure is minimal, while a higher cash allocation allows quick buying during market falls.
Sector Positioning
The fund is heavily tilted towards financial stocks, reflecting strong belief in India’s banking and financial services growth story.
Top Holdings
Major holdings include ICICI Bank, HDFC Bank, Axis Bank, SBI and SBI Life Insurance, along with stocks like Maruti Suzuki, Cipla and HCL Technologies.
Performance And Risk
Returns have been strong, though volatility is higher compared to Parag Parikh.
Asset Allocation Approach
Kotak Flexicap is the most aggressive, with 97.46% invested in equities and very little debt or cash.
Sector Positioning
The fund focuses more on cyclical sectors such as industrials, materials, energy and technology, making it sensitive to economic and capex cycles.
Top Holdings
Holdings include HDFC Bank, Bharat Electronics, Larsen & Toubro, Jindal Steel, SRF and Bharti Airtel.
Performance And Risk
Returns closely track the market, with higher volatility and moderate excess returns.
Also Read: Best Gold Mutual Funds in India for Jan 2026!
Even though all three funds are flexi-cap schemes, their investment styles are very different. Parag Parikh focuses on safety and global diversification, HDFC bets strongly on financial-led growth, and Kotak takes a bold equity and cyclical approach.
Parag Parikh, HDFC and Kotak together control over half of India’s ₹5.5 lakh crore flexi-cap market. Their contrasting strategies highlight why flexi-cap funds remain a popular choice for long-term investors seeking flexibility and diversified growth.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a private recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Jan 13, 2026, 11:04 AM IST
Kusum Kumari
Kusum Kumari is a Content Writer with 4 years of experience in simplifying financial market concepts. Currently crafting insightful content at Angel One, She specialise in breaking down complex topics into easy-to-understand pieces, blending expertise in market fundamentals and technical analysis.
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