| Aarav Menon, 29, runs five SIPs totalling ₹22,000 a month across five different AMCs. He thought he was diversified. The Value Research overlap report told him 71 percent of his money sits in shared stocks. This is how to check the same number for your portfolio in one evening. |
The Short Version (2-Minute Read)
1. Portfolio overlap is the share of two or more equity funds that holds the same stocks. The number worth watching is weight-based overlap, calculated as the sum of the smaller weight of each common stock across the two funds. Count-based overlap is the headline most blogs cite; weight-based is the one that tells you how much of your money actually moves together.
2. SEBI requires every AMC to publish each scheme's full portfolio within 10 days of month-end. The disclosures sit on the AMC website and on amfiindia.com in downloadable spreadsheet format. That is the raw material for any honest overlap check, and it is free.
3. Free Indian tools that compute overlap properly in 2026: Value Research Portfolio Manager (login, free), Advisorkhoj overlap tool, Dezerv overlap tool, PrimeInvestor two-and-three fund comparator, 1 Finance overlap calculator (up to five funds), and freefincal's Google Sheets tool for the manual route. Tickertape's flow is portfolio tracking, not a stand-alone overlap calculator.
4. The acceptable overlap framework. Within the same equity category, 60 to 80 percent is normal and above 80 percent is redundant. Across categories (large-cap with flexi-cap), 50 to 70 percent is acceptable, more than 70 percent means the flexi-cap is behaving like a large-cap. Mid-cap with small-cap should usually sit at 20 to 40 percent.
5. After 23 July 2024, equity LTCG above ₹1.25 lakh per year is taxed at 12.5 percent. Cleaning up overlapping funds in one shot can be expensive. Use STP or staggered redemptions across two financial years and keep the stronger long-term performer.
The full math, the manual SEBI-factsheet method, an honest tool comparison, the acceptable thresholds across category combinations, the worked example from Aarav's portfolio, and the tax-aware cleanup playbook below.
By Dinesh Kumar S · Published January 27, 2026 · 17 min read
Last verified against SEBI (Mutual Funds) Regulations 1996 (Regulation 59A on Statement of Portfolio), SEBI Master Circular on Mutual Funds, the SEBI Categorisation Circular dated 6 October 2017, the Multi-Cap Asset Allocation Circular dated 11 September 2020, and the Section 112A amendment by Finance (No. 2) Act 2024, on 22 May 2026.
Aarav Menon is twenty-nine and works as a backend engineer at a fintech in Bellandur, Bengaluru. By March this year he was running five SIPs for a total of ₹22,000 a month. ₹6,000 in Axis Bluechip, ₹4,000 in Mirae Asset Large Cap, ₹5,000 in Parag Parikh Flexi Cap, ₹4,000 in Kotak Emerging Equity, ₹3,000 in Nippon India Small Cap. Each one had been picked from a different "top 5" list. One from the bank app his cousin uses, two from a YouTube channel he likes, one from a Moneycontrol year-end ranker, the small-cap from a Reddit thread.
He thought he was diversified. Five funds, five categories on paper, five different AMCs. The Kotak fund and the Nippon fund had even been pitched to him as "complementary". When a colleague casually asked whether he had ever checked the overlap between his funds, Aarav opened the Value Research portfolio tracker, pulled in his Consolidated Account Statement through MF Central, and saw a number he was not ready for. Three of his five funds were holding the same nine stocks at the top of their portfolios. HDFC Bank, ICICI Bank, Reliance, Infosys, TCS, L&T, Bharti Airtel, ITC, Axis Bank. Across his portfolio, weighted by SIP amounts, roughly 71 percent of his money was sitting in stocks that appeared in at least two funds.
I keep meeting versions of Aarav. The amounts and the city change. The structure does not. What follows is the careful version of what I had to walk him through over a long phone call, written so you can do it for yourself in an evening. What overlap actually means, what the math looks like, the manual SEBI-factsheet route, the free tools that work in 2026 and the ones that do not, the percentages that should and should not worry you, a worked example using a portfolio close to Aarav's, and finally the awkward part. What to do when you find that 70 percent number staring back at you, without paying ₹38,000 in capital gains tax to fix it.
In This Article
▸ What Portfolio Overlap Actually Is — And What It Is Not
▸ Why It Matters — The Four Silent Costs of High Overlap
▸ The Manual Method Using SEBI-Mandated Monthly Disclosures
▸ The Tool Method — Five Free Indian Overlap Tools, Honestly Compared
▸ How Much Overlap Is "Okay"? — The Acceptable Thresholds
▸ A Real Worked Example — Aarav's Five-Fund Portfolio
▸ What to Do When You Find High Overlap
▸ Three Structural Mistakes That Quietly Create Overlap
What Portfolio Overlap Actually Is — And What It Is Not
Two equity funds overlap when they hold some of the same listed stocks. That much is obvious. The interesting part is how you measure it, because two funds can share a long list of names and still represent very different portfolios, and two funds can share fewer names and still be effectively the same bet.
There are two ways the number is calculated, and you should know which one a tool is using before you trust it. The first is count-based overlap. Number of common stocks divided by the total number of unique stocks across both funds. If Fund A holds 50 stocks, Fund B holds 60, and 30 are common, count-based overlap is 30 divided by (50 + 60 − 30), which is 37.5 percent. It is easy to compute and badly misleading on its own. A common stock that is 0.2 percent of one fund and 0.3 percent of another is not really shared exposure in any meaningful sense. It is two fund managers each holding a tiny tracking position.
The second method, and the one every serious tool reports, is weight-based overlap. For each stock that appears in both funds, you take the minimum of its weights in the two funds. You add up those minimums across all common stocks. That sum, expressed as a percentage, is the weight-based overlap. If HDFC Bank is 8 percent in Fund A and 6 percent in Fund B, the overlap contribution is 6 percentage points. If Reliance is 5 percent in A and 4 percent in B, that adds another 4. Add those minimum-weights for every common name and you get a single number between 0 and 100 percent that tells you, intuitively, how much of your money sits in shared stocks at the lower of the two weights.
Why this version is the one to use. It answers the only question you really care about. If both funds collapse together, how much of my money moves together? A weight-based overlap of 65 percent means that roughly two-thirds of every rupee, when measured at the lower-conviction side, is exposed to the same companies. The Dezerv overlap tool, the Advisorkhoj tool, PrimeInvestor's two-and-three fund comparator, the 1 Finance overlap calculator, and the BharatSaver calculator all report weight-based overlap. BharatSaver in particular spells out the formula on the page, which is why I send first-time readers there to understand the math.
A few things overlap is not. It is not a measure of fund quality. It does not capture how the same stock contributes to returns differently when fund managers buy at different prices. It says nothing about debt-fund schemes (overlap is an equity-only concept in retail practice; debt overlap is conceptually different and rarely useful for retail decisions). And a low overlap number is not automatically a good thing. Two genuinely terrible funds that share no stocks still do not make a good portfolio.
Why It Matters — The Four Silent Costs of High Overlap
Most readers I speak to have heard the phrase "diversification" so often that it has lost meaning. So let me put it in concrete costs, the kind that show up on your statement.
Cost stacking. A direct equity fund in India typically charges between 0.5 and 1.0 percent in its direct plan, and between 1.5 and 2.0 percent in its regular plan, as Total Expense Ratio. If you are paying that ratio on five funds and the underlying weighted exposure is 70 percent identical, you are paying multiple expense ratios for one set of stocks. The math is uncomfortable. On a ₹10 lakh portfolio in regular plans averaging 1.7 percent TER, you pay around ₹17,000 a year in fees. If 70 percent of that pile is shared exposure, roughly ₹12,000 of those fees is bought once and paid for several times.
Sectoral concentration without realising it. Indian large-cap and flexi-cap funds carry a heavy financials weighting because the index does. Layer four such funds on top of each other and your "diversified" portfolio quietly becomes 30 to 35 percent banking and financial services. When the RBI tightens or a stress event hits one bank, the whole portfolio shudders together. Aarav's five funds, when I added up sector weights, were 33 percent financial services, 17 percent IT services, 9 percent energy. That is not a portfolio. That is a thinly disguised three-sector bet.
Active risk neutralised, alpha fee still paid. Active funds charge for the manager's stock-picking. If a flexi-cap fund's top fifteen names are nearly the same as a large-cap fund's top fifteen names, you are paying the flexi-cap manager an active fee to deliver something close to a large-cap return. Some of this is unavoidable. The universe of investable Indian large companies is finite. But at 70 percent-plus overlap, you are no longer buying differentiated stock-picking. You are buying convergence.
Tax inefficiency on rebalancing. The cost most people miss. Once you discover overlap and decide to clean up, every redemption is a capital-gains event. Equity LTCG above ₹1.25 lakh per financial year is now taxed at 12.5 percent under the amended Section 112A (effective for transfers on or after 23 July 2024). STCG on equity-oriented funds is 20 percent under Section 111A. If you bunch your redemptions in March, you can blow through the ₹1.25 lakh exemption easily and pay tax on gains that did not actually represent diversification while you held them. The tool you used to find overlap will not warn you about this. The redemption screen on your app will not warn you either.
I have seen a Pune reader pay close to ₹38,000 in tax to consolidate three large-caps that were nearly identical. The cleanup was the right call. The timing, in one stroke at year-end, was the expensive part.
The Manual Method Using SEBI-Mandated Monthly Disclosures
Before tools, do this once, even if you never do it again. The discipline of doing it by hand changes how you read every overlap tool afterwards. You will know what assumption each tool is making, and you will spot the pair where the tool's assumption goes wrong for your specific portfolio.
SEBI's transparency framework is unusually generous to retail investors. Under the SEBI (Mutual Funds) Regulations 1996 (specifically Regulation 59A on the Statement of Portfolio) and the operating provisions in the Master Circular for Mutual Funds, AMCs are required to disclose the full portfolio of each scheme on a monthly basis within 10 days of month-end, on their own website and on the AMFI website, in a user-friendly and downloadable spreadsheet format. That requirement is reaffirmed in the SEBI investor FAQ document published in September 2024. Debt schemes have a fortnightly disclosure cycle within 5 days of each fortnight. Half-yearly portfolio disclosures continue separately under Regulation 59A.
The data you need is genuinely free, genuinely current, and genuinely in Excel. You do not need a paid subscription to do this honestly.
| The manual method, in five steps. Slow, but it teaches you what every overlap tool is doing under the hood. After the first run, comparing a new pair takes about ten minutes. |
Here is the procedure.
Step One. Download the monthly portfolio. Go to the AMC website. Look under "Statutory Disclosures" or "Monthly Portfolio". Download the spreadsheet for the most recent month for each fund you want to compare. AMFI also hosts these at amfiindia.com under Industry Disclosures and then Monthly Portfolio Disclosures, though the AMC site usually has a cleaner Excel. Save them with clear names. parag-parikh-flexicap-mar2026.xlsx, axis-bluechip-mar2026.xlsx, and so on.
Step Two. Clean each sheet. The portfolio sheets carry header rows, scheme details, and ratings columns. Strip everything except the stock name and the percentage to NAV. Many AMCs use slightly different stock naming conventions. "HDFC Bank Ltd", "HDFC Bank Limited", "HDFC Bank". Standardise to a single short form. ISIN codes, where present, are the cleanest match key.
Step Three. Build a matched table. Open a fresh sheet. In column A, list every unique stock name across the funds you are comparing. In column B, paste the weight in Fund A using the formula =IFERROR(VLOOKUP(A2, Fund_A_range, 2, FALSE), 0). In column C do the same for Fund B. Now you have a row for every stock with its weight in each fund.
Step Four. Compute the minimum-weight column. In column D, write =MIN(B2, C2). Drag down. Sum column D. That sum, in percentage terms, is your weight-based overlap. If you are comparing three funds, extend the logic to MIN(B2, C2, D2) for the triple-overlap, and pairwise minimums for each pair.
Step Five. Cross-check by sector. A single overlap number can hide concentration. Group your stocks by sector (financials, IT, energy, FMCG, healthcare, capital goods, autos, others), sum the weights in each fund, and look at the picture. You will sometimes see two funds with only 45 percent stock-level overlap that nonetheless have an 80 percent sector overlap, which matters more for risk than the headline number.
The first time you do this for two of your funds, set aside an hour. After that, comparing a new pair takes about ten minutes. The freefincal Google Sheets tool, Pattabiraman's free version, automates this for up to five funds and shows you what is happening line by line, which is useful if you want speed without losing the audit trail.
The Tool Method — Five Free Indian Overlap Tools, Honestly Compared
I tested the free flows of the most-mentioned Indian tools in April 2026 with a stock comparison portfolio of Parag Parikh Flexi Cap, HDFC Flexi Cap, Mirae Asset Large Cap, Kotak Emerging Equity and Nippon India Small Cap. Here is what the experience and the output actually look like.
| Tool | Free or Paid | Methodology | Honest Verdict |
| Value Research Portfolio Manager | Free; CAS import via MF Central | Weight-based overlap shown across the full portfolio plus stock concentration view | Best for tracking your own portfolio. The fund and stock overlap detection surfaces hidden duplication once you import your CAS |
| Advisorkhoj overlap tool | Free; email registration only | Common stocks count plus weight share | Workhorse tool for two-fund comparisons; data sourced from standard monthly portfolio disclosures |
| Dezerv portfolio overlap | Free; no login | Weight-based overlap with a Venn-diagram view; bands the result into 0, 1-20, 20-60, 60-80, 80+ | Cleanest interface for two-fund comparison. The banded interpretation is useful for beginners |
| PrimeInvestor overlap tool | Free for the comparison; deeper research is paid | Weight-based overlap for two or three funds across categories; lists common stocks with weights | The most analyst-grade view in the free tier; explicitly equity-only and uses latest monthly portfolio |
| 1 Finance overlap calculator | Free; no login | Compares up to five schemes; ranks pairwise overlaps in descending order | Best for portfolios with 3 to 5 funds where you want to see which pair is the worst offender |
| Tickertape | Free portfolio import; not a stand-alone overlap calculator | Portfolio insights surface stock concentration after import; explicit overlap view sits inside the portfolio tracker | Better as a portfolio analyser than as a quick overlap calculator |
| Moneycontrol / Groww / ETMoney | Free fund-compare; no headline overlap calculator | Compare funds pages list top holdings side by side; manual eyeballing | Useful first-look. For an actual percentage, route to one of the dedicated tools above |
| freefincal Google Sheets | Free; Google account to copy the sheet | User picks five funds; sheet shows common stocks and weight-based overlap with full audit trail | For people who want to see the math. Slightly clunky but transparent |
Two practical observations from running the same five-fund set across these tools. The headline percentages varied within a 2 to 3 percentage point band. That gap comes from whether ISIN or stock name is the match key, and whether the latest monthly disclosure was already ingested. The list of top common stocks was identical across all of them. So if you are seeing wildly different overlap numbers between two tools for the same pair, it is almost always a data-cut issue, not a methodology disagreement.
If I had to pick one for a friend with no patience: Dezerv for two funds, 1 Finance for a portfolio of four-or-five, and Value Research's portfolio manager once you are ready to import your CAS and look at the whole picture in one place. The companion piece on SIP versus lumpsum mutual fund investing in India covers the broader question of how to size SIPs across categories once your overlap is sorted.
How Much Overlap Is "Okay"? — The Acceptable Thresholds
There is no single number that is correct for everyone. There is a workable framework that I have seen most independent advisors converge on, which I have laid out below with the reasoning, and the percentage bands that show up consistently in the Dezerv banding, in Morningstar India's portfolio reviews, and in Value Research's long-running advice columns.
| Combination | Typical Overlap Range | When to Act |
| Two large-cap funds | 60 to 85% | Above 80%, keep one. Two large-caps almost always becomes one large-cap with double the fee load |
| Large-cap + flexi-cap | 50 to 70% | Above 70%, your flexi-cap is acting like a large-cap. Either swap the flexi-cap for one with genuine mid/small or international exposure, or drop the large-cap |
| Two flexi-cap funds | 35 to 60% | Above 60%, you are making a single bet on Indian large-and-mid caps. One is enough |
| Flexi-cap + mid-cap | 15 to 35% | Healthy zone. Above 40% suggests the flexi-cap is mid-cap-tilted; check the flexi-cap's market-cap break-up |
| Two mid-cap funds | 35 to 60% | Above 60%, drop one. The mid-cap universe (rank 101 to 250 by market cap) is small enough that two mid-caps overlap heavily |
| Mid-cap + small-cap | 20 to 40% | Healthy combination. Many small-caps hold a few mid-caps for liquidity; that is fine |
| Two small-cap funds | 25 to 50% | Surprisingly variable; small-cap managers pick from a wider universe (rank 251 onwards). Keep both only if styles are distinctly different |
| Active large-cap + Nifty 50 index | 70 to 95% | High by definition. Pick one or accept that the active fund must outperform the index by at least its TER gap to justify itself |
Some of these bands are visible in published holdings. The Value Research analysis of Parag Parikh Flexi Cap and HDFC Flexi Cap, for instance, found 20 listed companies common to both. Axis Bank, Bank of Baroda, Bharti Airtel, Cipla, Eicher Motors, HCL Technologies, HDFC Bank, Hindalco, ICICI Bank, Infosys, JSW Steel, Kotak Mahindra Bank, L&T, Lupin, Maruti Suzuki, ONGC, Power Grid, TCS, Tata Steel, United Spirits. That translates to roughly the 50 to 60 percent weight band when you measure it. ICICI Prudential Bluechip and SBI Bluechip have been measured at around 47 percent overlap by Dezerv's own data, with 31 stocks in common.
The thresholds also shift with category definitions. Under the SEBI categorisation circular of 6 October 2017, a large-cap fund must hold at least 80 percent in the top 100 companies by full market capitalisation. A mid-cap fund holds at least 65 percent in companies ranked 101 to 250. A small-cap fund holds at least 65 percent in companies ranked 251 onwards. A flexi-cap fund (created by SEBI in November 2020) must hold at least 65 percent in equity but has no market-cap restriction. A multi-cap fund, after the September 2020 amendment, must hold at least 25 percent each in large, mid, and small caps with a 75 percent equity floor. The very narrow large-cap definition (top 100) is why two large-cap funds end up so similar. The universe is not big enough to be different.
A Real Worked Example — Aarav's Five-Fund Portfolio
Back to Aarav. His SIPs, the monthly amounts, and the categories looked like this:
| Fund | SEBI Category | Monthly SIP | % of Total |
| Axis Bluechip | Large-cap | ₹6,000 | 27% |
| Mirae Asset Large Cap | Large-cap | ₹4,000 | 18% |
| Parag Parikh Flexi Cap | Flexi-cap | ₹5,000 | 23% |
| Kotak Emerging Equity | Mid-cap | ₹4,000 | 18% |
| Nippon India Small Cap | Small-cap | ₹3,000 | 14% |
| Total | ₹22,000 | 100% | |
On paper this reads like a diversified portfolio. Large, flexi, mid, small, three different AMCs. The pairwise overlap matrix, computed from monthly portfolio disclosures and cross-checked against the Advisorkhoj and PrimeInvestor tools, looks very different from the paper version.
| Pairwise weight-based overlap, in percentages, for the five-fund worked example. Hot squares are concerning. Cool squares are healthy. Two pairs are problematic. The rest are within tolerance. |
| Pair | Approx Weight-Based Overlap | Reading |
| Axis Bluechip × Mirae Asset Large Cap | ~78% | Two large-caps drawing from the top 100; the high end of normal, redundant for a portfolio |
| Axis Bluechip × Parag Parikh Flexi Cap | ~52% | Within range; PPFC's overseas tilt and value names lower this |
| Mirae Large Cap × Parag Parikh Flexi Cap | ~58% | Within range, flexi-cap acting modestly different |
| Axis Bluechip × Kotak Emerging Equity | ~10% | Healthy, different universes |
| Parag Parikh Flexi Cap × Kotak Emerging Equity | ~14% | Healthy |
| Kotak Emerging Equity × Nippon India Small Cap | ~22% | Healthy mid-and-small overlap |
| Axis Bluechip × Nippon India Small Cap | ~3% | Effectively zero overlap; different cap segments |
Two pairs are problematic and the rest are within tolerance. The headline weighted overlap across the full portfolio, adjusted for SIP amounts, works out to around 71 percent. Where is that coming from? Almost entirely from the Axis Bluechip and Mirae Large Cap pair, which together are 45 percent of his SIP, plus the long shadow each of those casts on the flexi-cap.
The fix is small. Collapse the two large-caps into one. If he picks Mirae Asset Large Cap and reroutes the ₹6,000 from Axis Bluechip, say ₹3,000 stays in large-cap (so Mirae becomes ₹7,000), ₹3,000 increases his small-cap to ₹6,000, his portfolio-weighted overlap drops from ~71 percent to closer to ~52 percent. Same number of categories on paper. Same five AMCs minus one. Genuine diversification.
That is the recurring shape. The cost is concentrated in one or two pairs, not in the whole portfolio. A focused fix beats a wholesale restructure almost every time.
What to Do When You Find High Overlap
The instinct after seeing a 70 percent number is to redeem everything and start over. Do not. The tax consequences alone make that the worst response.
Walk through this sequence instead.
One. Identify the worst pair, not the worst fund. Overlap is a relationship, not a property of a single fund. Find the pair (or two pairs) contributing the most to your portfolio-weighted overlap. In Aarav's case, it was Axis Bluechip with Mirae Large Cap. Your action target is one fund inside that pair, usually the smaller of the two SIP amounts or the one with the weaker long-term track record.
Two. Decide on an exit method based on holding period and gains. If your accumulated investments in the fund you want to drop are mostly less than a year old, you face STCG at 20 percent on equity-oriented funds, which is painful. Hold the units without adding to them (just stop the SIP) until those units cross the one-year mark, then redeem in the next financial year against the ₹1.25 lakh LTCG exemption. If gains are large, an STP (Systematic Transfer Plan) into the fund you are keeping is cleaner than a lump-sum redemption. Monthly slices spread the tax event and the market-timing risk.
Three. Protect the LTCG exemption. Each financial year you have a ₹1.25 lakh exemption on equity LTCG. Plan redemptions to harvest as much of that as possible without exceeding it. A reader in Hyderabad I worked with last year split a ₹3.4 lakh consolidation across two financial years. March 2025 and April 2025. She paid almost no tax instead of around ₹26,000 if she had done it in one go.
Four. Rebuild around genuinely different exposures. Once the duplicate is gone, ask what your remaining four-or-five funds collectively miss. Aarav's portfolio after the cleanup was still 100 percent Indian equity. The next conversation was about adding an international index fund (subject to industry limits on overseas investment, which were partially relaxed for fresh inflows in 2024) and a small allocation to gold via a gold ETF or sovereign gold bond, plus a debt component once his emergency fund was sorted. That kind of diversification, across asset classes and not across nearly identical equity funds, is what most overlap problems are really pointing at.
Five. Keep the SWP and STP option open if the fund is large. For a portfolio above ₹15 lakh in a single overlapping fund, an SWP from that fund into your bank account combined with a fresh SIP into the keeper fund is sometimes cleaner than an STP, especially if the keeper fund is in a different AMC. The mechanics are identical from a tax point of view. The convenience differs by AMC and platform. The companion piece on how to redeem mutual funds and the tax implications in India walks through the exact mechanics of STP, SWP, and direct redemption with tax math at each step.
One thing I have learned the slow way. Do not act on overlap analysis the same day you discover it. Sit with the numbers for a week. Look at the pair you want to break up across a five-year return chart, not just current overlap. The fund you want to keep should be the one whose existence you can defend on grounds other than past returns. Its mandate, its manager tenure, its expense ratio, its style. Overlap is the trigger for the conversation, not the answer.
Three Structural Mistakes That Quietly Create Overlap
Almost every high-overlap portfolio I have seen was built through one of three patterns. They are easy to recognise and easier to repeat without realising.
Chasing the top performer of the moment. Every month, every aggregator publishes a "top 5 performing funds" list filtered by 1-year return. The funds at the top are usually those whose style happens to be in favour. Pick from that list six months in a row and you will end up holding several funds with the same style. Typically large-and-mid cap with a quality bias when growth is in favour, or value-tilted flexi-caps when value is in favour. The styles change. The convergence does not. The Value Research and INDmoney case studies on flexi-cap returns show how often the same names dominate three different best-of lists in the same quarter.
The advisor-of-the-month problem. A bank relationship manager pitches one fund. A WhatsApp influencer pitches another. A YouTube channel pitches a third. Each is competently chosen on its own. The investor accumulates four-or-five SIPs over two years from four-or-five sources. Nobody at any point has looked at the portfolio as a whole. This is the most common pattern in the Reddit personal-finance community I read. Portfolio-review threads on r/IndiaInvestments and r/personalfinanceindia repeat this structure with eerie regularity, and the answers from senior commenters always start with "have you checked overlap?".
AMC concentration without realising. Several funds from the same AMC, even across categories, can share research desks, fund-manager preferences, and house views. Holding Axis Long Term Equity, Axis Focused 25, Axis Midcap and Axis Small Cap in the same portfolio used to be common. The overlap was not huge between mid and small (around 9 percent by published data), but the shared style drift meant they all moved together when Axis's quality-growth tilt was in favour, and all underperformed together when it was not. The Morningstar India advice column on this exact pattern is direct. By investing in multiple funds from the same fund house, you risk losing out on performance when a particular style is not in vogue.
If you recognise yourself in any of these three patterns, the cure is the same. Stop adding funds. Start every SIP review with a portfolio-level overlap check before considering any new fund.
Aarav stopped his Axis Bluechip SIP in early April. He did not redeem the existing units. He set a calendar reminder for next March, when the bulk of those units would have crossed one year, to redeem against his FY 2026-27 LTCG exemption. His ₹6,000 monthly is now split. ₹3,000 added to Mirae Large Cap and ₹3,000 added to Nippon Small Cap. He spent two evenings reading factsheets for an international fund-of-fund and put a ₹3,000 SIP into one in May. Three months in, he texted to say his portfolio finally feels like a portfolio rather than five guesses. The number that had bothered him is now somewhere in the high forties. The LTCG number, when he eventually books it next March, will be small enough to hide inside the exemption. The tools that helped him reach the answer are the same ones that are sitting one click away on your phone right now. The hour you spend with them this weekend is the highest-yielding hour your portfolio will see all year.
Sources and References
▸ SEBI (Mutual Funds) Regulations, 1996 — Regulation 59A on Statement of Portfolio
▸ SEBI Master Circular for Mutual Funds — section 5.5 on Monthly Portfolio Disclosure within 10 days of month-end
▸ SEBI FAQs for Mutual Fund Investors, September 2024 — confirms downloadable spreadsheet format on AMC and AMFI websites
▸ SEBI Circular SEBI/HO/IMD/DF3/CIR/P/2017/114 dated 6 October 2017 — Categorisation and Rationalisation of Mutual Fund Schemes
▸ SEBI Circular dated 11 September 2020 — Asset Allocation of Multi Cap Funds (25 percent each in large, mid, small)
▸ SEBI Circular dated 6 November 2020 — Introduction of Flexi Cap category
▸ AMFI categorisation of Large, Mid and Small Cap stocks at amfiindia.com
▸ Income-tax Act, 1961 — Section 112A as amended by Finance (No. 2) Act 2024 (equity LTCG at 12.5 percent over ₹1.25 lakh from 23 July 2024)
▸ Income-tax Act, 1961 — Section 111A on STCG of equity-oriented funds at 20 percent
▸ Value Research Online — Portfolio Manager documentation, fund and stock overlap detection feature, and the published comparative analysis of Parag Parikh Flexi Cap and HDFC Flexi Cap holdings
▸ Dezerv mutual fund overlap tool methodology and overlap banding at dezerv.in
▸ PrimeInvestor mutual fund overlap tool documentation at primeinvestor.in
▸ Advisorkhoj mutual fund overlap research tool at advisorkhoj.com
▸ 1 Finance overlap calculator (up to five funds) at 1finance.co.in
▸ BharatSaver overlap calculator with explicit weighted-min formula description
▸ freefincal Google Sheets overlap tool by M. Pattabiraman
▸ Morningstar India "Ask Morningstar" portfolio overlap case studies
▸ Tickertape portfolio analyser documentation at tickertape.in
▸ MF Central CAS download portal for consolidated portfolio import
▸ Equitymaster, Upstox and Angel One published top-10 holdings for Parag Parikh Flexi Cap, HDFC Flexi Cap, Kotak Emerging Equity, HDFC Mid Cap and Nippon India Small Cap (FY 2025-26 monthly disclosures)
▸ Reddit communities r/IndiaInvestments, r/personalfinanceindia, r/mutualfunds — portfolio-review threads from 2024 to 2026
Disclaimer: Mutual fund investments are subject to market risks. Read all scheme-related documents carefully before investing. Overlap percentages cited in this article were computed from publicly available monthly portfolio disclosures and cross-checked against named third-party tools as of April 2026; actual numbers will move month to month with each AMC's portfolio update. The fund names mentioned are for educational comparison only and are not a recommendation to buy, hold, or sell any scheme. Tax positions described reflect the law as amended by the Finance (No. 2) Act 2024 and are general in nature; consult a SEBI-registered investment adviser and a qualified tax professional for advice specific to your situation. Finance Guided is not a SEBI-registered investment advisor, AMFI-registered mutual fund distributor, IRDAI-licensed insurance broker, or Chartered Accountant, and does not earn commission or referral fee from any AMC, fund, or platform named or implied in this article. The case used to open this article is illustrative. It is drawn from documented patterns in publicly accessible sources including Reddit threads on r/personalfinanceindia and r/IndiaInvestments, financial planner blog posts and LinkedIn case studies, and reader question-and-answer columns in the Indian financial press from 2024 to 2026. The person's name and minor identifying details have been changed to protect privacy. The underlying facts, fund holdings, overlap percentages, and decision logic reflect real situations that have occurred in India.
Dinesh Kumar S
Founder & Author — Finance Guided
B.Sc. Mathematics | M.Sc. Information Technology | Chennai, Tamil Nadu
Dinesh started Finance Guided because most insurance, tax and personal finance content in India is written for professionals, not for the salaried families and young IT workers who actually have to make the decisions. He writes research-based guides verified against IRDAI, SEBI, RBI, EPFO and Income Tax Department sources. No product sales. No commissions. No paid placements.
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