HDFC Flexi Cap Fund, one of the standout schemes in India’s mutual fund market, has shown strong performance over the years. It has grown to be a preferred choice for many investors seeking long-term capital growth. Launched by HDFC Mutual Fund, India’s largest asset management company, this scheme has consistently delivered significant returns across different market conditions.
Let’s take a closer look at how the HDFC Flexi Cap Fund has performed and why it could be a valuable addition to your investment portfolio.
Key Features of HDFC Flexi Cap Fund
HDFC Flexi Cap Fund is an open-ended dynamic equity scheme that invests across large-cap, mid-cap, and small-cap companies. The fund aims to generate capital appreciation by investing in a diversified portfolio of equity and equity-related instruments.
- Launch Date: 1 January 1995
- Assets Under Management (AUM): Rs. 66,225.06 crore (as of September 30, 2024)
- Benchmark Index: NIFTY 500 Total Returns Index
- Expense Ratio: 1.43% (Regular Plan), 0.77% (Direct Plan)
- Risk Level: Very High
- Minimum SIP Investment: Rs. 100
Impressive Returns Over Time
The HDFC Flexi Cap Fund has consistently provided strong returns to its investors, outperforming many other funds in the market. Whether an investor has held the fund for 1 year, 5 years, or even since its inception, the fund has delivered robust growth.
Here’s a look at the fund’s historical returns:
- Since Inception: Rs. 1 lakh invested at the fund’s launch has grown to Rs. 1.95 crore (with a CAGR of 19.38%).
- In 10 Years: Rs. 1 lakh has grown to Rs. 4.40 lakh (CAGR of 15.96%).
- In 5 Years: Rs. 1 lakh has grown to Rs. 3.03 lakh (CAGR of 24.83%).
- In 3 Years: Rs. 1 lakh has grown to Rs. 1.98 lakh (CAGR of 25.67%).
- In 1 Year: Rs. 1 lakh has grown to Rs. 1.46 lakh (CAGR of 45.76%).
This demonstrates that the fund has not only managed to grow investors’ money over a long period, but has also performed well in the short to medium term.
Diversified Investment Strategy
One of the reasons for HDFC Flexi Cap Fund’s success is its flexible investment approach. The fund spreads its investments across large-cap, mid-cap, and small-cap stocks, allowing it to capitalize on opportunities across different segments of the market.
The fund follows a strategy of investing in well-established companies that have the potential to weather difficult market conditions and provide consistent returns over the long term. By diversifying its portfolio, the fund reduces the risk of exposure to any single sector or market event.
Top Holdings and Sector Allocation
The HDFC Flexi Cap Fund’s portfolio includes a strong mix of leading companies across multiple sectors, ensuring a balanced and stable approach to equity investing. The top holdings include leading banks and IT companies, reflecting its diversified investment strategy.
As of September 30, 2024, the top holdings in the fund are:
- HDFC Bank Ltd.: 9.42%
- ICICI Bank Ltd.: 9.23%
- Axis Bank Ltd.: 8.56%
- HCL Technologies Ltd.: 4.83%
- Cipla Ltd.: 4.80%
- Bharti Airtel Ltd.: 4.78%
In terms of sectoral allocation, the fund is primarily invested in:
- Financial Services: 38.8%
- Healthcare: 12.5%
- Automobiles & Auto Components: 9.7%
- Information Technology: 9.4%
- Telecommunication: 4.6%
This diversified portfolio helps minimize risks while aiming for long-term growth. The fund’s strong allocation to financial services and healthcare also provides resilience against market volatility.
Ideal for Long-Term Investors
The HDFC Flexi Cap Fund is designed for investors who are looking to build wealth over the long term. It is particularly suitable for those who can withstand the ups and downs of the equity market and are seeking steady returns over time.
With its low portfolio turnover, the fund maintains a stable approach to investing, ensuring that it is not overly reactive to short-term market fluctuations. This makes it a solid option for investors who prefer a long-term investment strategy without the need for constant portfolio management.
Is HDFC Flexi Cap Fund Right for You?
The HDFC Flexi Cap Fund’s long-term performance and diversified approach make it an appealing option for investors who are willing to take on a high level of risk in exchange for potentially higher returns. The fund’s flexibility to invest across large, mid, and small caps allows it to adapt to changing market conditions, while its diversified portfolio reduces the risk associated with equity investments.
However, it is essential to note that equity mutual funds, including the HDFC Flexi Cap Fund, come with inherent risks. Past performance is not a guarantee of future returns, and investors should consider their risk tolerance and investment horizon before investing.
For those who are ready to invest for at least three to five years, the HDFC Flexi Cap Fund can be an excellent option for building long-term wealth. However, it’s always advisable to consult a financial advisor to ensure this scheme aligns with your investment goals and risk profile.
Disclaimer: The content provided is for informational purposes only and should not be considered as investment advice. Always consult with your financial advisor before making any investment decisions.
