Trust Mutual Fund has launched Flexi Cap Fund NFO. This open-ended fund invests in large-cap, mid-cap and small-cap stocks. Over the past five years, Flexicap mutual funds have generated an average return of 18% across mutual fund schemes. The hard truth is that some flexicap funds were even generating below bank FD rates till last year, but thanks to the bull market, they are now seeing higher returns. The fund’s brochure says its objective is to invest in identifying potential “gorilla companies” that are rare, dominant and unchallenged.Should you invest? Trust MF Flexicap NFO• This article provides details about NFOs, investment strategy, target audience, risk factors, performance of existing flexi-cap funds, and our views on this NFO.?
Also read: This large- and mid-cap mutual fund has grown from $100,000 to $8.3 million in the past 10 years
TrustMF Flexi Cap Fund – NFO issuance details
Click here for details on NFO.
| Fund name | TRUSTMF Flexi Cap Fund |
| NFO is open | April 5, 24 |
| NFO closing | April 19, 24 |
| Scheme re-opened for continued purchase/sale | Within 5 business days |
| Minimum application amount | 1,000 rupees, thereafter in multiples of 1 rupee |
| Minimum SIP | 1,000 rupees in 6 months |
| Fund NAV | 10 rupees during NFO period. |
| entry road | Nothing |
| End of loading | 1% if redeemed within 180 days |
| danger | very high risk |
| standard | nifty 500 try |
| fund manager | Mihir Vora Aakash Mangani |
Trust MF Flexi Cap Fund SID Prospectus
What is the investment objective of Trust MF Flexi Cap Fund NFO?
We provide investors with long-term growth in capital and income through a diversified portfolio of equities and equity-related securities across the market capitalization range, as well as active management of investments in fixed income and money market products.
However, there can be no guarantee that the scheme’s investment objective will be achieved..
What is the allocation pattern for this fund?
The investment pattern of this fund is as follows.
| Type of instrument | minimum% | maximum% | risk profile |
|---|---|---|---|
| Large-cap, mid-cap, small-cap stocks and stock-related products company |
65% | 100% | very expensive |
| Debt and money market securities | 0% | 35% | low to medium |
| Units issued by REITs and InVITs | 0% | Ten% | very expensive |
Why invest in Trust MF Flexi Cap Fund NFO?
Here are some reasons to invest in this fund.
- Flexicap funds can invest in the entire market capitalization, i.e. large-cap, mid-cap and small-cap stocks.
- This kind of portfolio diversification reduces risk. Previously, we recommended three of her Flexicap funds as part of: Most recommended mutual funds.
- The fund’s brochure says it invests in companies that find rare, powerful and unchallenged potential gorilla companies.
- We have observed in the past that large-cap stocks offer stable returns, while mid- and small-cap stocks tend to offer superior returns. Therefore, a flexi-cap fund with such a combination has the potential to generate higher returns. Please see the diagram below taken from the Trust MF Flexi-cap Fund brochure.
Trust MF Flexi Cap Fund NFO risk factors
You should consider some of these risk factors/negative factors before investing.
- The Fund invests in high-risk small- and medium-sized stocks.
- Investing in small-cap stocks can have liquidity issues.
- SEBI recently asked AMC to conduct stress tests on mid-cap and small-cap funds to see how quickly they can liquidate their shares. Stress testing of some mid-cap and small-cap funds showed that liquidation of mid- and small-cap stocks takes a long time.
How are the existing Flexi Cap funds performing?
Below is the performance of the Flexicap mutual fund scheme.
| scheme name | 3 years | 5 years | 10 years |
|---|---|---|---|
| Quant Flexi Cap Fund | 35% | 30% | twenty four% |
| Parag Parikh Flexicap Fund | twenty four% | twenty four% | 20% |
| JM Flexi Cap Fund | 28% | twenty three% | 20% |
| PGIM India Flexi Cap Fund | 18% | twenty one% | – |
| Union Flexi Cap Fund | twenty one% | 20% | 15% |
| HDFC Flexi Cap Fund | 28% | 20% | 18% |
| Franklin India Flexicap Fund | twenty three% | 19% | 18% |
| Edelweiss Flexi Cap Fund | twenty two% | 19% | – |
| Canara Robeco Flexi Cap Fund | 18% | 18% | 16% |
| DSP Flexi Cap Fund | 17% | 18% | 17% |
| HSBC Flexi Cap Fund | twenty one% | 17% | 16% |
| Aditya Birla Sun Life Flexi Cap Fund | 18% | 17% | 18% |
| Kotak Flexi Cap Fund | 18% | 16% | 18% |
| Axis Flexi Cap Fund | 15% | 16% | – |
| Navi Flexi Cap Fund | 19% | 16% | – |
| Tata Flexi Cap Fund | 17% | 16% | – |
| Shriram Flexi Cap Fund | 20% | 16% | – |
| SBI Flexi Cap Fund | 17% | 16% | 18% |
| Bandhan Flexi Cap Fund | 18% | 15% | 15% |
| UTI Flexi Cap Fund | Ten% | 14% | 15% |
| Motilal Oswal Flexi Cap Fund | 17% | 14% | – |
| LIC MF Flexi Cap Fund | 16% | 14% | 12% |
| Taurus Flexi Cap Fund | 18% | 13% | 12% |
Should I invest in Trust MF Flexi Cap Fund NFO?
Trust MF Flexi Cap Fund invests across market capitalization i.e. large caps, mid caps and small caps.
On the plus side, large-cap stocks offer stable returns, while mid- and small-cap stocks have the potential to generate higher returns. Such funds help investors diversify their portfolios.check This Flexi Cap Mutual Fund has grown from $100,000 to $9.2 million in the past 10 years.
The downside is that exposure to the mid-cap and small-cap segments is high risk.
High-risk investors can invest in such funds with a medium- to long-term perspective. Alternatively, you can invest in existing flexi-cap mutual funds that have already proven their performance over various market cycles.
Suresh KP is the founder of Myinvestmentideas. He is a NISM Certified Investment Advisor and he is a NISM Certified Research Analyst. He has been analyzing financial markets for the past 20 years. He can be reached at suresh@myinvestmentideas.com.
