Most of the flexicaps are allocating more to largecap stocks. By considering that, if we want real diversification can we go for large&midcap funds?
I personally dont prefer MIDCAP 150 index fund becz of tracking errors
Yes… most of the flexicaps are large cap biased holding more than 70% large cap and we dont know they can increase it to 100 percent also. But large&midcaps has to hold atleast 35% midcap and making it really diversified across caps.
People might argue in flexicaps, fund manager can switch across caps depending on market up/downs on specific cap. But imagine if a fund is holding 70% in large caps how could he sell everything and buy midcaps if midcaps are performing better than largecaps.
1 Like