Parag Parikh Flexi Cap Cuts Cash Holdings To 8.78% From 25.31% In A Year: Where Has The Fund Invested The Money?

Parag Parikh Flexi Cap Fund has used a large part of the cash buffer it was holding a year ago. Its cash allocation fell to 8.78% in October 2026, compared with 25.31% in October 2025, according to the fund's latest factsheet.

That is a reduction of 16.53 percentage points, or nearly 65% of its earlier allocation. The cash figure includes debt and money-market instruments, along with arbitrage positions. The money can be moved into equities when the fund finds suitable investment opportunities.

The shift has taken place even as the fund's one-year return remains in negative territory. Its regular plan lost 6.06% over the 12 months ended 9 November 2026.

How The Fund's Cash Allocation Has Changed

Parag Parikh Flexi Cap Fund had been holding a sizeable cash buffer for some time. Its allocation stood at 24.53% in March 2025 and rose slightly to 25.31% by October that year.

The decline became more visible in 2026. Cash holdings fell to 21.34% in January and 18.94% in March. By August, the figure had dropped to 11.58%. It slipped further to 9.77% in September before reaching 8.78% in October.

The latest figure is a sharp departure from the fund's position a year earlier, when roughly a quarter of its portfolio was parked in cash, debt and similar instruments.

Where Is PPFAS Investing The Money?

The reduction in cash has gone alongside a rise in the fund's Indian equity allocation. Its core Indian equity exposure increased from 62.55% in October 2025 to 75.25% in October 2026, a gain of 12.70 percentage points.

Recent additions to the portfolio include companies such as DLF, Mahindra & Mahindra, Maruti Suzuki and Indus Towers, along with selected gas businesses.

There have also been changes in its overseas holdings. During October, the fund exited Meta Platforms, reduced its exposure to Microsoft and added Netflix to the portfolio.

The fund's approach to deploying cash was explained earlier by Raj Mehta, Executive Vice President and Fund Manager – Equity at PPFAS Mutual Fund, in an interaction with Moneycontrol. He said investment decisions depend on the opportunities available rather than the overall level of the market.

Mehta had also pointed to two types of opportunities: Time corrections in the broader market, where prices remain subdued for a period, and price corrections in individual stocks. Both can give the fund an opportunity to start fresh positions or add to existing holdings.

Fund’s One-Year Performance Remains Negative

The increase in equity exposure has not yet translated into a recovery in the fund's recent returns.

ACE MF data as of 9 November 2026, shows that the regular plan gained just 0.40% over one month. Its return was negative 3.21% over three months and negative 2.55% over six months. Over one year, the fund delivered a negative return of 6.06%.

The longer-term numbers tell a different story. The regular plan has generated annualised returns of 11.67% over three years and 10.06% over five years. Its annualised return since inception stands at 16.86%.

The fund now has just 8.78% of its portfolio in cash, debt, money-market instruments and arbitrage positions, against 25.31% a year earlier. Its Indian core equity allocation has risen to 75.25%. Whether this shift helps its performance will depend on the stocks it has added and how those businesses perform in the coming quarters.

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