While the recovery in the frontline large-cap indices seems firm after the corrective and sideways phase of the past 15 months, the broader benchmarks and lower market cap constituents are still considerably in the red.

Despite the correction, valuations aren’t in the inexpensive zone for mid and small-caps, though there are pockets of attractive opportunities available. With a resurgent and reasonably valued large-cap space, the time may be ripe to go with a flexicap fund from a long-term perspective.

Canara Robeco Flexicap (Canara Robeco Equity Diversified earlier) is a fund with a strong track record of over 22 years.

Over the years, it has demonstrated consistently healthy performances over the longer investment terms of five years or more.

Investors can buy units of the fund with a 7-10-year perspective. Taking the systematic investment plan (SIP) route may be advisable, by directing proceeds to specific financial goals.

Sturdy outperformance

Canara Robeco Flexicap’s performance over the past decade has been healthy with point-to-point returns of 15.5 per cent compounded annually over this period.

When five-year rolling returns over the period January 2013 to December 2025 are considered, the fund has delivered mean returns of 15.8 per cent. The Nifty 500 TRI gave 14.7 per cent average returns over the above-mentioned timeframe.

On a 5-year rolling returns basis over the 13-year period indicated earlier, Canara Robeco Flexicap has beaten the Nifty 500 TRI over 76 per cent of the times.

The scheme has given more than 12 per cent for nearly 82 per cent of the time and in excess of 15 per cent for nearly 59 per cent of the time on 5-year rolling basis over the 13-year period (Jan 2013-Dec 2025).

Canara Robeco Flexicap’s returns (XIRR) on monthly SIPs over the past 10 years are fairly robust at 16.5 per cent. A similar SIP in the Nifty 500 TRI would have returned 15.7 per cent over this period.

All return figures pertain to the direct plan of the fund.

The fund has an upside capture ratio of nearly 97.5, indicating that its NAV rises less than the benchmark during rallies. But more importantly, it has a downside capture ratio of 85.9, indicating that the scheme’s NAV falls a lot less than the benchmark during corrections. A score of 100 indicates that a fund performs in line with its benchmark. This inference is based on data from December 2020-December 2025.

Leaning on large-caps

Canara Robeco Flexicap has stuck to keeping its portfolio heavy on large-cap stocks across market cycles. In fact, it has increased large-cap exposure from 70-odd per cent a year or so back to around 75 per cent in the recent portfolio. Mid-cap exposure is kept in the early to mid-teen percentages, while small-caps generally account for low single digits, making the portfolio reasonably moderate on risks.

This large-cap bias has helped the fund remain resilient during the broader market falls and also in the early recovery in many bluechips over the past 12-15 months. The fund takes cash positions of only about 3 per cent and does not go too defensive during corrections.

Canara Robeco Flexicap has a mix of both value and growth styles of investing in its choice of sectors and stocks.

Banks have always been the top sector holdings across market phases. Like with its large-cap bias, a higher exposure to banks has helped the fund’s performance given the sector’s sound run in the last 18 months.

Surprisingly, software companies have also figured prominently in the portfolio despite the underperformance from the larger names in the space in the last couple of years. However, in the past year, it has taken exposure in mid-tier IT companies that have done well.

Retailing is a segment that the fund has upped stakes in after the correction in the space. It has expanded the scope for the sector with investments in ecommerce and physical retail firms.

Automobiles also occupy a significant portion in Canara Robeco Flexicap’s holdings. Exposure is restricted to the top car and two-wheeler companies in the segment.

Pharmaceutical and biotechnology firms are other important holdings across timeframes.

The fund is suitable for investors with an above-average risk appetite looking for steady long-term outperformance. Taking the SIP route would be useful in averaging costs, especially during volatile market phases.

Published on December 27, 2025