A Flexi Cap Fund invests across large-cap, mid-cap, and small-cap stocks without fixed allocation limits — the fund manager freely shifts weights based on market opportunities.
SEBI introduced the Flexi Cap category in 2020 to give fund managers maximum flexibility. A flexi cap fund must invest at least 65% in equity across any combination of large, mid, and small-cap stocks. The fund manager can dynamically shift allocations — going heavily into large-caps during uncertainty and rotating into mid/small-caps during recoveries. This flexibility makes Flexi Cap funds one of the most versatile equity fund categories.
Most equity funds are locked into a specific market cap segment — a large-cap fund must stay in large-caps even if mid-caps are offering better opportunities. A Flexi Cap fund breaks this constraint. The manager can hold 80% large-cap today and shift to 60% mid/small-cap when valuations look attractive. This is like having a cricket captain who can move any player to any position — maximum tactical flexibility.
Minimum 65% in equity; no mandatory split between large/mid/small-cap.
Fund manager decides the mix based on valuations, market conditions, and macro outlook.
Most flexi cap funds in practice hold 40–70% in large-caps for stability, 20–40% in mid/small-caps for growth.
Different flexi cap funds can look very different — compare portfolios to understand each manager's actual approach.