Investment: Multi-asset or flexi-cap options offer better returns? Check out this comparison before investing...

The way global tensions have dominated the equity market over the past few months has significantly impacted market sentiment. Since Trump came to power, the market has seen significant volatility. In such a situation, many experts consider investing in mutual funds to be safer and more profitable than investing in stocks. Data also shows that the number of demat accounts is rapidly increasing. Investing through SIPs has simplified and made the process of investing in mutual funds easier and more accessible. This raises the question of which of the many fund options available in the market is best for you. To answer this question, we are going to explain in detail two major categories of funds in the market: multi-asset and flexi-cap.

Multi-Asset Funds
Multi-asset funds are funds that invest in three or more asset classes, such as equity, debt, and gold. The combination of stocks, bonds, and gold in a single fund helps distribute risk. If the stock market falls, gold or debt offsets this, preventing significant losses for investors. These funds' returns over the short term have ranged from -0.78% to +0.46%. This reflects normal fluctuations, but over three- and six-month periods, many funds have delivered returns of 8% to 11%.

1-Month Returns

Multi-Asset Fund Returns Flexi/Focused Fund Returns
1 Kotak Multi Asset Omni FoF Direct 2.28% SBI Focused Fund Direct 4.21%

2 UTI Multi Asset Allocation Fund Direct 2.22% Old Bridge Focused Fund Direct 4.16%

3 ICICI Prudential Passive Multi-Asset FoF Direct 2.09% Aditya Birla Sun Life Focused Fund Direct 3.94%

Flexi-Cap Funds
While flexi-cap funds invest solely in equities, the fund manager has complete freedom to vary the ratio between large, mid-, and small-cap companies as desired. The market was quite volatile in 2025, falling by nearly 8 percent in the middle of the year, but despite this, most large flexi-cap funds outperformed the Nifty 500 TRI. Over the past year, eight out of ten large flexi-cap funds delivered returns ranging from 10% to 13%, while the benchmark only delivered around 8%.

6-Month Returns

Multi-Asset Fund Returns Flexi/Focused Fund Returns
1. Kotak Multi Asset Allocation Fund Direct 16.21%
2. LIC MF Flexi Cap Fund Direct 15.14%
3. HSBC Multi Asset Allocation Fund Direct 14.57%
4. Helios Flexi Cap Fund Direct 13.78%
5. DSP Multi Asset Allocation Fund Direct 13.65%
6. ICICI Pru Retirement Fund Pure Equity 13.29%
Data Source: BT, Groww, Screener

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