Multi-cap Funds vs Flexi-cap Funds
19 Jan 2023
While both multi-cap funds and flexi caps fund have similar attributes, they vary on important parameters which makes a difference to the investors.
Many existing flexi-cap funds have been renamed from their previous avatar as large cap or large & mid cap funds, so their long-term performance is not conclusive.
Difference between multi-cap and flexi-cap funds
| Multi-cap Funds | Flexi-cap Funds |
|---|---|
| Minimum 75% of assets in equities and related instruments | Minimum 65% of assets in equities and related instruments |
| Minimum 25% in large caps, mid caps and small caps respectively | Flexibility to invest across market caps |
| Suitable for investors with higher risk appetite given the rigid ceiling in mid caps and small caps which see higher volatility vis-à-vis large caps | Not as volatile as multi-caps since fund manager can steer across market caps without restrictions making it suitable for a wider equity investor audience |
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