ETMutualFunds looked at the performance of flexi cap funds in the last 10 years. We looked at the returns generated by these schemes if someone was investing through Systematic Investment Plan or SIP in the last 10 years. Flexi cap funds is a new category. However, diversified equity schemes that invest across capitalisations and sectors have been around for a long times. Sure, they used to be called multi cap schemes for while, before Sebi started calling them flexi cap funds in November 2020.
According to data from Ace MF, 12 flexi cap schemes offered more than 12% SIP returns in 10 years. Around 2 schemes offered more 15% SIP returns in 10 years. Only 2 schemes offered single-digit returns.
If you are new to mutual funds and only recently started investing in them through SIPs, you can still hope to make better returns (higher than other safe options) from equity schemes over a long period of time. Sure, we talk about double-digit returns over a long period of time. However, you, especially if you are very young, should keep in mind that the returns may come down in future. As India becomes a developed country, double-digit returns may become difficult to generate. However, the stock market may still offer superior returns over a long period. This is why investment experts ask investors to choose equity schemes to achieve their long-term goals.
We have taken flexi cap schemes as an example. However, you should always choose your investments based on your goals, horizons, and risk appetite. For example, Flexi cap schemes are recommended to investors with a moderate risk profile. If an investor has a conservative risk appetite, he can choose large cap schemes. Those with very high risk appetite can consider investing in mid cap, small cap, sector/thematic schemes.
If you want to know more about these categories and our recommended schemes, see:
Best large cap schemes
Best flexi cap schemes
Best mid cap schemes
Best small cap schemes
