These 10 mutual funds attracted the most money in August. How have they performed?

Which mutual funds attracted the most investor money in August? The list was surprisingly familiar.

Nine of August’s top 10 funds were also among the top 10 in July. But while the names largely stayed the same, their rankings moved quite a bit, and recent returns do not fully explain where the money went.

Bandhan Small Cap Fund remained the biggest inflow magnet for the second month in a row. It received Rs 2,187 crore in August, up from Rs 2,003 crore in July.

It also stood out on performance, with an 11.14% return over one year and 23.53% over three years, the highest three-year return among August’s top 10 funds.

But look further down the list and the relationship between performance and inflows becomes less straightforward.

Which funds attracted the most money?

HDFC Mid Cap Fund was second in August with net inflows of Rs 1,418 crore, followed by Kotak Multi Cap Fund at Rs 1,165 crore.

HDFC Flexi Cap Fund received Rs 1,144 crore, while Parag Parikh Flexi Cap Fund attracted Rs 1,097 crore. ICICI Prudential Flexi Cap Fund was close behind at Rs 1,091 crore.

SBI Focused Fund, Nippon India Growth Mid Cap Fund, Bandhan Large & Mid Cap Fund and Abakkus Flexi Cap Fund completed August’s top 10.

Negative one-year returns, but strong inflows

Two funds in the top five had negative one-year returns.

HDFC Flexi Cap returned -0.95% over one year, yet attracted Rs 1,144 crore in August. Its inflows were also almost unchanged from July’s Rs 1,132 crore.

Parag Parikh Flexi Cap shows an even sharper contrast. Its one-year return stood at -4.05%, the lowest among the funds with a one-year track record in August’s top 10, but it still received Rs 1,097 crore.

There was, however, a clear slowdown. The fund had attracted Rs 1,583 crore in July and ranked second. Its August inflows were about 31% lower, taking it down to fifth place.

That suggests recent returns alone do not explain where investors are putting their money. Longer-term track record, SIP flows, existing investor base and the size of a fund can also influence monthly inflows.

Kotak Multi Cap makes the biggest jump

Kotak Multi Cap saw one of the sharpest changes in rank.

Its inflows increased from Rs 915 crore in July to Rs 1,165 crore in August, a rise of around 27%. That pushed it from seventh place to third.

Its returns were more moderate compared with some other funds on the list, at 3.79% over one year and 15.63% over three years.

At the other end, Abakkus Flexi Cap slipped from sixth place in July to tenth in August as inflows fell from Rs 937 crore to Rs 857 crore. The fund is less than a year old, so longer-term return comparisons are not yet available.

Most names stayed the same, but the order changed

The top-10 list itself was remarkably stable. Nine funds appeared in both July and August.

ICICI Prudential Flexi Cap was the only new entrant in August’s top 10, while Invesco India Small Cap dropped out. Invesco had ranked eighth in July with inflows of Rs 911 crore.

Interestingly, Invesco India Small Cap had delivered a 15.25% one-year return and 21.82% over three years, stronger than several funds that remained in August’s top 10.

Fund size also changes the picture

Absolute inflows can also look very different when seen against AUM.

Bandhan Small Cap had AUM of around Rs 34,176 crore at the end of August, while its monthly inflow was Rs 2,187 crore.

Parag Parikh Flexi Cap, in comparison, had AUM of around Rs 1.47 lakh crore. HDFC Flexi Cap and HDFC Mid Cap were also above Rs 1 lakh crore.

So an inflow of around Rs 1,000 crore can mean something quite different depending on how large the fund already is.

Overall, August’s most popular funds were not simply the best recent performers. The list included strong performers, large established schemes with steady inflows and funds that continued to attract substantial money despite weaker one-year returns.

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