This flexi cap mutual fund outperformed peers with 20% return in one year

5paisa Research Team

Last Updated: 12th December 2022 - 08:29 am

The Indian stock market touched a new high last October and tried to breach the mark twice early this year, only to fail both the times. The market has now slipped 15% below the all-time high. It is now almost flat if we compare on a twelve-month basis.

However, some mutual funds have clearly beaten the benchmark indices.

If we look at flexi-cap mutual funds schemes that have the flexibility to invest in stocks across market-caps, one fund that has churned out an astounding nearly 20% return in the last one year is ICICI Prudential Retirement Fund - Pure Equity Plan (Direct).

The fund was launched three years ago and over that period has been a medium performer in terms of returns. However, it came out as an outlier over the last one year, beating highly rated funds in its peer group comprehensively.

In fact, if we look at the tier universe of flexi cap mutual funds, it has not even churned out 1% return in the last one year.

So, what’s pushing up the performance of this fund?

The fund has built a portfolio of 35 stocks, of which 10 stocks comprise over half of its portfolio.

It is overweight on giant and large caps and underweight on mid-cap and small-cap space compared to the peer group.

It is bullish on financials, which make for its single-largest exposure. It is also overweight on healthcare, technology, automobiles, communication and insurance stocks.

While the fund stayed put with its top bets—Bharti Airtel, HCL Tech, HDFC Bank, Axis Bank and Infosys, it did add UltraTech, Lupin, Gujarat Gas, BPCL, Alkem, Ambuja Cements in the month of May. It also increased its investments in Maruti Suzuki.