Investment experts Kirtan Shah and Nirav R. Karkera discussed strategies for selecting mutual funds and managing portfolios during market volatility on CNBC TV18.

These insights provide a framework for retail investors to navigate fluctuating markets by understanding the structural differences between various equity fund categories. Choosing the wrong fund type can lead to unintended risk exposure or missed growth opportunities depending on the investor's goal.

Shah, the founder and CEO of Truvanta Wealth Pvt. Ltd, and Karkera, the head of research at W by Groww, focused on the distinction between flexi-cap and multi-cap funds. Flexi-cap funds led the equity category for the eighth consecutive month in March 2026 [1]. These funds are required to invest at least 65% of their total assets in equity and equity-related instruments [2].

In contrast, multi-cap funds follow a more rigid allocation rule. These funds must allocate a minimum of 25% to each of large-cap, mid-cap, and small-cap stocks [3]. This structure ensures a diversified spread across different company sizes regardless of market conditions.

The experts also touched upon historical performance to illustrate market behavior. In 2025, the Nifty 50 delivered roughly 10% return [4]. During that same period, the Nifty Midcap 150 Index returned about five% [5]. These figures highlight the variance in returns between large-cap and mid-cap segments, a factor that influences how fund managers shift assets.

Beyond fund selection, the discussion covered portfolio re-balancing and the role of alpha funds. Alpha funds aim to beat the market benchmark by identifying undervalued stocks. The experts suggested that investors evaluate their risk tolerance before deciding between the flexibility of a flexi-cap fund or the mandated diversification of a multi-cap fund.

Shah and Karkera said that informed choices are essential for maintaining long-term stability when the broader market remains unpredictable.

“Flexi-cap funds led the equity category for the eighth consecutive month in March 2026.”

The preference for flexi-cap funds suggests that investors are increasingly valuing managerial discretion over rigid allocation. By allowing fund managers to shift assets between market caps based on current valuations, investors can potentially mitigate losses during downturns in specific sectors while capturing growth where it is most prominent.