A flexi Cap fund is an equity scheme that invests at least 65% investments in equity & equity related instruments and is free to invest in companies of all sizes and regardless of industries. The name Flexi is a shortened version of Flexible as they do invest in large, mid and small companies i.e. across all market capitalisations.

The portfolio of Flexi Cap funds is better diversified as assets are allocated across companies of varying sizes, eliminating the need for specific market segment choices. This diversification strategy aims to reduce risks tied to individual market segments, ultimately contributing to increased stability within the overall portfolio.

It is also a tax friendlier option compared to investing in dedicated large or mid cap funds as this would necessarily mean redemption in one fund and then a subscription in the other fund.