An underrated and under-appreciated flexi-cap fund

Summary: This fund has been around for over a decade, yet it’s only the 18th largest flexi-cap fund in India. But look beyond its size, and you’ll find a remarkable story. In terms of returns and consistency, it trails only Parag Parikh’s much-celebrated flexi-cap scheme. In fact, on several metrics, it has quietly outperformed many of its more famous peers. Let’s uncover which fund this is, and how impressive its long-term record truly is.

Some mutual funds quietly deliver strong performance year after year, yet rarely make it to investors’ top lists. JM Flexicap Fund is one such gem, a consistent performer that doesn’t get the spotlight it deserves.

This four-star-rated fund has been around for over a dozen years. Over the long term, its performance speaks for itself:

• Three-year returns: Fifth-best among flexi-cap funds
• Five-year returns: Sixth-best
• 10-year returns: A remarkable 18.01 per cent, second only to the Parag Parikh Flexi Cap Fund (18.8 per cent).

And yet, JM Flexicap remains a lightweight in terms of popularity, managing less than Rs 6,000 crore in assets, making it just the 18th largest flexi-cap fund in the country. For context, the two largest flexi-cap funds, Parag Parikh Flexi Cap and HDFC Flexi Cap, manage Rs 1.2 lakh crore and Rs 85,500 crore, respectively.

So, why is such a strong performer still flying under the radar? Is there a catch? Has it been inconsistent in the past? Let’s find out.

Consistency in performance

Point-to-point returns — like three-year or five-year figures mentioned in the initial part of the article — tell you how much a fund made over that period. But they don’t tell you how consistently the fund delivered those returns.

Which is why we looked at the rolling returns. Think of rolling returns like checking your report card not just once, but after every exam.

Instead of looking at how a fund did only from say February 10, 2020 to February 10, 2025, we look at every possible five-year stretch in between. We basically for all the dates, like February 11, 2020 to February 11, 2025, February 12, 2020 to February 12, 2025, February 13, 2020 to February 13, 2025, and so on.

This helped us see if the fund scores well most of the time, or just got lucky in one or two years. In short, rolling returns show how consistent a fund really is — whether it performs well again and again, not just once in a while.

So, when we looked at five-year daily rolling returns of JM Flexicap Fund and the four largest flexi-cap funds in the country between October 23, 2020 and October 23, 2025, here’s what we found:

Even by this metric, JM Flexicap ranks second only to Parag Parikh, beating all other large and well-known peers.

To take it a step further, we examined how frequently each fund beat its benchmark (the Nifty 500 TRI) over these five-year periods.

The results were telling:

• Parag Parikh Flexi Cap: Beat the index 100 per cent of the time.
• JM Flexicap: Beat the index 92 per cent of the time.
• HDFC Flexi Cap: 72 per cent.
• UTI Flexi Cap: 52 per cent.
• Kotak Flexicap: Just over 26 per cent.

That means JM Flexicap outperformed the index nearly every time, even more consistently than most of the industry’s biggest names.

This level of steadiness, across different market cycles, is what makes JM Flexicap such an underrated performer.

Higher volatility

Of course, consistency doesn’t mean calm sailing. One reason JM Flexicap remains a lesser-known fund could be its higher volatility.

Volatility is captured by a metric called standard deviation, which tells you how much a fund’s returns tend to swing from its average. A higher number means more ups and downs.

Here’s how the top flexi-cap funds stack up on volatility (last five years):

As you can see, JM Flexicap has been the most volatile of the lot, meaning its short-term movements can be sharper, both upwards and downwards.

However, volatility isn’t always bad, especially if the fund can capture more of the market’s gains than its losses.

That’s where upside and downside ratios come in.

• Upside ratio measures how much a fund rises when the market goes up. For example, an upside ratio of 120 means that when the benchmark index rises 10 per cent, the fund would have gained an average of 12 per cent during the same period.
• Downside ratio measures how much it falls when the market goes down.
  A higher upside ratio (and a reasonable downside ratio) is a sign of a fund that manages volatility well.

Here’s how these funds perform on that front:

JM Flexicap leads the pack on upside ratio, meaning it benefits the most when markets rise. Its downside protection is middle-of-the-road, which explains the fund’s higher volatility, but also why it can deliver such strong long-term returns. Essentially, JM Flexicap knows how to run faster in rallies, even if it stumbles a bit during corrections.

Should you invest in JM Flexicap Fund?

JM Flexicap has a strong long-term record and also has one of the lowest expense ratios, of 0.54 per cent (direct plan), in the flexi-cap universe. But past performance doesn’t guarantee future results, and markets evolve constantly.

So, if you’re evaluating flexi-cap funds for your portfolio, start by checking Value Research Ratings, which assess funds on risk-adjusted performance, not just raw returns. They’re a great starting point to shortlist reliable options.

And for a truly personalised approach, explore Value Research Fund Advisor. It doesn’t just recommend good funds, it helps you choose the right ones for your financial goals, risk appetite and time horizon. You’ll get expert guidance on portfolio allocation, periodic rebalancing and staying on track for long-term wealth creation.

Explore Fund Advisor Today

Also read: Why are investors ignoring a top flexi-cap of last 5 years?