Record ₹10,000 Crore Inflow into Flexi-Cap Mutual Funds in December

New Delhi:
Investor confidence in mutual funds continues to strengthen, with flexi-cap mutual funds witnessing a record-breaking inflow in December. According to data released by the Association of Mutual Funds in India (AMFI), investments into flexi-cap funds touched an all-time high of ₹10,019 crore during the month, the highest-ever monthly inflow recorded in this category.

The December inflow marked a 23% increase over November’s ₹8,135 crore and a sharp 112% rise compared to December 2024, when inflows stood at ₹4,730 crore. The surge highlights growing investor preference for diversified equity strategies amid volatile market conditions.

Why Flexi-Cap Funds Are Gaining Popularity

Market experts attribute the strong inflows to the inherent flexibility of flexi-cap funds, which allow fund managers to invest across large-cap, mid-cap and small-cap stocks based on valuations and growth prospects. This adaptability has become particularly attractive at a time when mid- and small-cap segments have delivered uneven returns.

Vishal Dhawan, Founder and CEO of Plan Ahead Wealth Advisors, told ETMutualFunds that flexi-cap funds have outperformed several other equity categories in recent periods. “Given the volatility seen in 2025, investors are increasingly gravitating towards funds that give managers the freedom to dynamically adjust market-cap exposure,” he said.

A Preferred Core Investment Option

Financial planners believe flexi-cap funds are emerging as a preferred core holding for long-term investors due to their diversified nature. Rajesh Minocha, Founder of Financial Radiance and a Certified Financial Planner (CFP), said he has consistently advocated flexi-cap funds, adding that recent data validates their effectiveness. “Choosing capable fund managers and allowing them to navigate across market caps can create sustainable long-term value,” he noted.

Experts Urge Caution Despite Record Inflows

While the record inflow reflects strong investor sentiment, experts caution against chasing short-term trends. Dhawan emphasized that investors should not increase allocations solely based on headline inflow numbers. “Flexi-cap funds are suitable as core holdings, but investments should always align with one’s long-term asset allocation strategy,” he advised.

Market participants suggest that investors should continue systematic and need-based investments rather than reacting to temporary market noise. For existing investors, staying invested and maintaining discipline remains the most prudent approach.

The record inflows into flexi-cap funds underline a broader shift towards balanced and flexible equity investing, reinforcing the growing maturity of Indian retail investors.