A large number of young investors are now looking out for mutual funds and SIPs that are offering good returns in the near term, rather than the traditional investment instruments like FDs, etc.
Flexi cap investment rationale
The Flexi cap mutual funds are known as open-ended and dynamic equity funds. The fund house will invest in different stocks depending on various market capitalizations, that is large-caps, mid-caps & small-caps stocks. The large caps stocks are the top 100 companies listed in the equity markets, and these are known as safe and secured investment options. On the other hand, the mid and caps stocks can offer better returns in short term, however, they will come with higher risks.
For any mutual funds, investors should look out for the NAV and AUM to understand the profitability.
Edelweiss Flexi Cap Fund – Direct Plan – Growth
Edelweiss Flexi Cap Fund – Direct Plan is a mutual fund SIP investment that has a NAV of Rs. 24.27, and the size – Of assets Under Management (AUM) of this fund is Rs. 945.14 crore. AUM is the total market value of the assets which a mutual fund will manage at a point in time. On the other hand, the Expense Ratio (ER) of this fund is 0.50%, while the category average is 0.95%. The Expense Ratio is the percentage, which the fund house will use from the retail investors’ investments, for fund management purposes. The ER is quite lower than the category average in this case, so it is helpful to the profitability of the investors.
This mutual fund SIP has been best rated with 4 Star by rating agency Crisil.
Absolute and annualized returns
As it is a Flexi cap fund, its absolute returns from SIPs have been reported higher in the long term. In the last 1-year SIP return stood at 3.15%, in the last 2 years it has fetched 28.48% returns, in the last 3 years it has given 39.31% returns, in the last 5 years, it has fetched 52.86% returns. Annualized returns from Edelweiss Flexi Cap Fund – Direct Plan’s SIP were 26.19% in the past 2 years, and 22.76% in the past 3 years.
Edelweiss Flexi Cap Fund – Direct Plan’s absolute mutual fund returns are highest in 5 years terms. In the last 1 year return stood at 20.39%, in the last 2 years it has fetched 92.12% returns, and in the last 3 years it has given 59.97% returns, in the last 5 years it has given 96.07% returns. In the past 2 years, the Edelweiss Flexi Cap Fund – Direct Plan’s annualized returns stood at 38.61%, marginally outperforming the category average at 37.28%.
(Data till April 27, 2022)
Edelweiss Flexi Cap Fund – Direct Plan’s total equity holding is 95.26%, and the rest of the 9.83% is invested in other sectors. Among a total of 56 stocks, the Fund’s Large Cap Investments are 57.19%, Mid Cap Investments are 11.45%; Small-Cap Investments are 15.35%, and 12.62% investments are allocated to other funds.
The top 10 equity holdings of the fund are Infosys Ltd., ICICI Bank Ltd., HDFC Bank Ltd., Reliance Industries Ltd., State Bank Of India, Axis Bank Ltd., Bharti Airtel Ltd., Mphasis Ltd., Tata Motors Ltd., Larsen & Toubro Ltd.
Other funds under this category are, PGIM India Flexi Cap Fund – Direct Plan – Growth, HSBC Flexi Cap Fund – Direct Plan – Growth, Union Flexi Cap Fund – Direct Plan – Growth, etc.
Investing in equities/mutual funds/SIPs/debts poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, and the author are not liable for any losses caused as a result of decisions based on the article.