Glossary· Ratings & classification
What is Category & sub-category?
SEBI's scheme classification — what the fund is allowed to hold.
Since 2018 every open-ended scheme must sit in exactly one defined sub-category (Large Cap, Mid Cap, Flexi Cap, Corporate Bond, and so on) with binding holding rules. It is the only sound basis for comparing two funds — everything on this site ranks within sub-category, never across.
For the formula and the constants behind this figure, see Methodology.
Guides that use Category & sub-category
10 guides put this term to work.
- Equity funds demystified: large cap, mid cap, small cap and the SEBI rulebookSince 2017 every open-ended scheme sits in one defined box with a binding rule on what it must hold. What the boxes mean, and why comparing across them fails.
- Flexi cap vs multi cap: which strategy offers better flexibility?One is obliged to hold small caps; the other is free not to. The 2020 rule change that created the split, and why it affects how you read an older track record.
- Debt funds explained: duration risk and credit risk are not the same thingSixteen SEBI categories along two independent axes. Why a gilt fund can have a worse year than an equity fund, and what the 2023 tax change actually removed.
- Sectoral and thematic funds: high risk, high reward — or just hype?The launch cycle is a coincident indicator of the peak, not a signal. Why concentration is the product, and the conditions under which one is defensible.
- Mutual fund overlap: are you really diversified?Diversification stops early and overlap starts at once. Why the answer is four to six, how to measure your duplication, and how to unwind it without a tax bill.
- Credit risk and yield-to-maturity in debt fundsA high YTM describes the risk taken, not the return you will earn. How to read it beside the rating profile, and what a credit event permanently does.
- Infrastructure and PSU funds: riding the government capex cycleA leveraged bet on capex and policy, with a specific trap: cyclicals look cheapest exactly when earnings have peaked, which is also when the schemes launch.
- Banking and financial services funds: doubling a bet you already holdFinancials are already the largest sector in every diversified portfolio. Lenders book revenue years before they discover its cost — hence the dangerous cycle.
- How SEBI's rules actually protect a retail investorThe structural protections, the conduct rules and the safety nets — and the more useful half: an explicit list of what none of it protects you from.
- Thirty years back, thirty years ahead: how Indian funds evolvedNearly every protection you rely on exists because something failed. Which incident produced which rule, and what is likely, uncertain and unlikely next.
More on ratings & classification
How funds are grouped and scored here.
- Star rating
- Our own 1–5 stars: 60% performance, 15% risk, 10% cost, 15% downside.
- Peer group
- The funds a rating or rank is measured against — same sub-category, plan and option.