What counts as 'too much' overlap between two mutual funds?

There's no official SEBI threshold, but as a rule of thumb, overlap above 50-60% means the two funds are largely duplicating each other — you're unlikely to gain meaningful extra diversification from holding both. Overlap below 30% generally means the funds are meaningfully different in their stock selection, even if they're in the same broad category.

Why do two funds in different categories still show overlap?

Category labels (Large Cap, Flexi Cap, Multi Cap) describe market-cap mandates, not the specific stocks a fund manager picks. Many fund managers across categories independently converge on the same large, liquid, well-covered stocks (HDFC Bank, ICICI Bank, Reliance, Infosys, L&T), so overlap can appear even across differently labeled funds.

Does this tool check overlap for more than 2 funds?

This free tool is capped at exactly 2 funds. FundSageAI's logged-in Compare page supports overlap checking across up to 5 funds at once, along with the full list of shared stocks and their weights in each fund — sign up free to use it on your own portfolio.

Is high overlap always bad?

Not necessarily — if you deliberately want concentrated exposure to a set of large, high-conviction stocks, some overlap is expected and fine. The risk is *unintentional* overlap: adding a new fund assuming it diversifies your portfolio when it's actually re-buying stocks you already own through another fund.

Portfolio Management

Fund Overlap Checker

Check how much two mutual funds overlap in their underlying stock holdings — free online tool for Indian investors to avoid over-concentration across funds.

Fund A

Fund B

What is Fund Overlap Checker?

A Fund Overlap Checker compares the actual stock holdings of two mutual funds and calculates what percentage of their portfolios coincide. High overlap between funds you hold means you're paying two expense ratios for what is effectively one diversified bet — a common mistake among Indian retail investors who add funds from different AMCs assuming automatic diversification. Two 'Flexi Cap' funds from different fund houses can easily share 40-60% of their top holdings (HDFC Bank, ICICI Bank, Reliance, Infosys appear in most large-cap-leaning portfolios), meaning the second fund adds far less true diversification than its category label suggests.

How to use this tool

Search and select the first mutual fund by name.

Search and select the second mutual fund by name.

Click 'Check Overlap' to see the percentage of shared holdings and the number of common stocks.

Use the result to decide whether both funds earn a place in your portfolio, or whether one is redundant.

The Formula

Overlap % = Sum of min(weight in Fund A, weight in Fund B) across every stock held by both funds

A stock held at 8% in Fund A and 6% in Fund B contributes 6% to the overlap score — the smaller of the two weights, since that's the portion that's genuinely duplicated.

Key Benefits

✓Spot redundant funds before adding a new SIP — avoid paying two expense ratios for near-identical exposure.
✓Understand true diversification instead of assuming different fund houses means different holdings.
✓Quick, free, no signup required for a 2-fund check.
✓Works for any two actively traded equity mutual funds in India.

Practical Example

Fund A: HDFC Flexi Cap Fund (Direct Growth) Fund B: Parag Parikh Flexi Cap Fund (Direct Growth) - Common stocks: 18 - Portfolio overlap: 34.2% This means roughly a third of both portfolios' weight sits in the same 18 stocks — moderate overlap, meaning both funds still contribute meaningfully different exposure.

Common Questions

Frequently Asked Questions

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