About Flexi Cap Mutual Funds
SEBI introduced Flexi Cap Funds in November 2020, as open-ended equity schemes with the flexibility to invest across market capitalisations. Unlike category-restricted funds, flexi cap funds allow fund managers complete freedom to shift allocations based on market opportunities, valuations, and economic trends.
This dynamic structure enables active portfolio rebalancing as market conditions evolve. Flexi Cap Mutual Funds are generally suitable for long-term wealth creation, with an investment horizon of 5 years or more to effectively manage equity market volatility.
How Do Flexi Cap Funds Work?
Flexi Cap Funds operate with a dynamic investment approach. They are required to invest a minimum of 65% of their assets in equity and equity-related instruments, but unlike other categories, there are no fixed allocation rules for large-cap, mid-cap, or small-cap stocks. This gives fund managers complete flexibility in portfolio construction.
Fund managers actively decide where to allocate capital based on market cycles, economic outlook, and valuation opportunities. During volatile phases, they may increase exposure to relatively stable large-cap stocks. In bullish phases, they may allocate more towards mid-cap or small-cap companies with higher growth potential.
Stock selection is driven by detailed fundamental analysis. Managers assess company earnings, cash flows, debt levels, competitive positioning, and management quality. Sector trends and macroeconomic indicators are also evaluated before making allocation decisions.
The goal is to create a diversified portfolio that balances growth and risk by dynamically adjusting exposure across market capitalisations as conditions change.
Top 10 Flexi Cap Funds to Invest in 2026
The following are the top Flexi Cap Funds in India:
| Fund Name | AUM (₹ in crore) | CAGR (3Y) (%) | Expense Ratio (%) | Absolute Returns – 1Y (%) |
| Motilal Oswal Flexi Cap Fund | 13,180.03 | 23.89 | 0.83 | 7.01 |
| Bank of India Flexi Cap Fund | 2,167.16 | 23.77 | 0.50 | 11.74 |
| HDFC Flexi Cap Fund | 97,451.56 | 23.20 | 0.65 | 15.39 |
| Invesco India Flexi Cap Fund | 4,584.14 | 22.89 | 0.56 | 10.29 |
| JM Flexicap Fund | 5,152.36 | 22.04 | 0.58 | 1.13 |
| WOC Flexi Cap Fund | 7,131.81 | 21.44 | 0.50 | 12.92 |
| Edelweiss Flexi Cap Fund | 3,133.23 | 21.30 | 0.43 | 15.02 |
| Parag Parikh Flexi Cap Fund | 1,33,969.81 | 21.12 | 0.63 | 7.93 |
| ICICI Pru Flexicap Fund | 19,681.19 | 20.75 | 0.79 | 15.04 |
| HSBC Flexi Cap Fund | 5,317.76 | 20.72 | 1.20 | 12.28 |
Note: The data above is as of Feb 11, 2026, and is sorted and ranked as per 3-year CAGR.
Motilal Oswal Flexi Cap Fund
This fund seeks to achieve long-term capital appreciation by primarily investing in equity and equity-related instruments across sectors and market-capitalisation levels. It is an open-ended equity Flexi Cap scheme that dynamically allocates across large, mid and small cap stocks. The fund is managed by a team comprising Swapnil Mayekar, Rakesh Shetty, Ajay Khandelwal, and Atul Mehra. The expense ratio is 0.83%.
Bank of India Flexi Cap Fund
Bank of India Flexi Cap Fund aims to generate long-term capital growth by investing predominantly in equity and equity-related securities across various market capitalisation segments. This open-ended Flexi Cap equity scheme adapts allocations across large, mid and small cap stocks. The scheme is managed by Alok Singh. The expense ratio is 0.50%.
HDFC Flexi Cap Fund
HDFC Flexi Cap Fund targets long-term capital appreciation through investments in a diversified portfolio of equity and equity-related securities across large, mid and small caps. Categorised as an open-ended Flexi Cap equity scheme, it balances exposure across market caps to capture opportunities. The scheme is managed by Amit Ganatra. The expense ratio is 0.65%.
Invesco India Flexi Cap Fund
This fund is structured to deliver capital appreciation by investing in equity and equity-related securities of companies across large, mid and small cap segments following a bottom-up, style-neutral, sector-agnostic selection approach. It is an open-ended Flexi Cap equity scheme managed by Taher Badshah under Invesco’s investment framework. The expense ratio is 0.56%.
JM Flexicap Fund
This scheme strives for long-term capital growth by investing primarily in equity and equity-related instruments across various market capitalisation levels. The scheme is part of the equity Flexi Cap category and is managed by Satish Ramanathan, Asit Bhandarkar, Deepak Gupta and Ruchi Fozdar. The expense ratio is 0.58%.
Wealth One Capital Flexi Cap Fund
This fund also pursues long-term capital appreciation via a diversified equity portfolio spanning large, mid and small cap stocks. It is a Flexi Cap scheme. The fund managers are Ramesh Mantri, Piyush Baranwal, Trupti Agrawal and Dheeresh Pathak. The expense ratio is 0.50%.
Edelweiss Flexi Cap Fund
Edelweiss Flexi Cap Fund aims to generate long-term capital appreciation by investing in a diversified portfolio of equity and equity-linked instruments across large, mid and small cap companies. This open-ended Flexi Cap equity scheme is managed by a team including Trideep Bhattacharya, Ashwani Agarwalla and Raj Koradia to identify quality businesses suited to the fund’s strategy. The expense ratio is 0.43%.
Parag Parikh Flexi Cap Fund
This scheme seeks to deliver long-term capital growth through a diversified, actively managed portfolio predominantly of equity and equity-related securities including Indian and foreign stocks. It is an open-ended Flexi Cap scheme managed by Rajeev Thakkar, Raunak Onkar, Raj Mehta and Rukun Tarachandani across equity and other investment components. The expense ratio is 0.63%.
ICICI Prudential Flexicap Fund
This fund has an investment objective to seek long-term capital appreciation by investing predominantly in equity and equity-related securities across market capitalisations. This Flexi Cap equity scheme is managed by Rajat Chandak, focusing on diversified stock selection across sectors. The expense ratio is 0.79%.
HSBC Flexi Cap Fund
HSBC Flexi Cap Fund aims for long-term capital growth by deploying investments in equities of companies across large, mid and small cap segments within a diversified, risk-managed framework. The open-ended Flexi Cap scheme is managed by Abhishek Gupta. The expense ratio is 1.20%.
Features of Flexi Cap Funds
Flexi Cap Funds are structured equity schemes designed to offer allocation flexibility within a regulated framework. Their defining features lie in portfolio construction rules, managerial freedom, and structural design rather than investor benefits.
-
Minimum 65% Equity Allocation: Flexi Cap Funds are required to invest at least 65% of their total assets in equity and equity-related instruments. This classifies them as equity-oriented schemes while still allowing limited allocation to other instruments if needed.
-
Unrestricted Market Capitalisation Allocation: Unlike multi-cap funds, there is no mandatory percentage allocation to large-cap, mid-cap, or small-cap stocks. Fund managers can allocate capital freely across segments based on valuations and market conditions.
-
Dynamic Asset Allocation Framework: The portfolio structure allows managers to increase or decrease exposure to specific market capitalisations depending on economic cycles, volatility levels, and sector performance.
-
Active Portfolio Rebalancing: Flexi Cap Funds are actively managed. Portfolio holdings are reviewed and adjusted regularly to reflect changes in earnings outlook, macroeconomic trends, and company fundamentals.
-
Category-Level Structural Flexibility: Compared to categories with fixed allocation rules, flexi cap funds operate under a more adaptable regulatory structure, allowing tactical shifts without breaching market-cap constraints.
Advantages of Flexi Cap Funds
Flexi Cap Funds offer strategic advantages due to their adaptable structure and diversified equity exposure. Below are the key advantages explained clearly:
-
Broad Market Exposure: Flexi Cap Funds invest across large-cap, mid-cap, and small-cap companies as well as multiple sectors. This wide coverage allows investors to participate in growth opportunities across the broader equity market through a single fund.
-
Better Risk Distribution: By spreading investments across company sizes and industries, these funds reduce reliance on any single segment. This diversified structure helps cushion portfolio impact during sector-specific or segment-specific slowdowns.
-
Managerial Flexibility: Fund managers are not bound by fixed market-cap allocation rules. This freedom enables timely shifts in allocation based on valuations, economic outlook, and evolving market trends.
-
Potential for Competitive Returns: The ability to move between growth-oriented and stable companies allows the fund to capture opportunities across market cycles, potentially delivering returns that compare favourably with benchmark indices or single-cap strategies.
-
Simplified Portfolio Management: Investors can gain diversified equity exposure without managing multiple funds dedicated to different market capitalisations.
Factors To Consider Before Investing in Flexi Cap Funds
Before investing in a Flexi Cap Fund, evaluate whether it aligns with your financial objectives, time horizon, and comfort with market fluctuations. Consider the following key factors:
-
Risk Profile: Flexi Cap Funds invest predominantly in equities and can shift allocations across company sizes. Review the current portfolio composition to understand the level of volatility you may experience.
-
Investment Horizon: These funds are better suited for long-term investing. A time frame of 5 years or more allows the portfolio to benefit from market cycles and dynamic allocation decisions.
-
Fund Manager’s Strategy: Since allocation decisions depend on the fund manager, review their track record, investment philosophy, and consistency across market conditions.
-
Portfolio Role: Determine how the fund fits within your overall asset allocation. It should complement your existing investments rather than duplicate exposure across similar equity segments.
-
Expense Ratio and Costs: Lower expenses can enhance long-term returns. Compare the fund’s cost structure with peers before investing.
Who Should Invest in Flexi Cap Funds?
Flexi Cap Funds are suitable for investors who want flexibility, diversification, and professional management within a single equity portfolio. Here are the profiles that may benefit the most:
-
Long-term investors: Individuals having a five-year or longer investment horizon, as flexi cap funds seek to capitalise on growth across market cycles.
-
Investors with moderate to high risk: Individuals who are comfortable with short-term price swings and the volatility of the equities market.
-
Investors seeking diversification: Individuals who prefer not to manage multiple equity funds may consider flexi-cap funds. They offer exposure across market segments within a single scheme, simplifying portfolio construction while maintaining broad equity participation.
-
Investors who value active management: If you want experienced fund managers to adjust your allocations based on economic and market developments.
Taxability of Flexi Cap Funds
Taxation of Flexi Cap Funds is divided into two components: capital gains and dividends. The tax treatment depends on the holding period and income slab.
Capital gains tax:
-
Short-term capital gains (STCG): Gains realised within 12 months are taxed at 20%.
-
Long-term capital gains (LTCG): Gains realised after 12 months are taxed at 12.5% on profits exceeding ₹1.25 lakh in a financial year.
Dividend taxation:
-
Dividends received are added to your total taxable income and taxed according to your applicable income tax slab.
-
A 10% TDS may apply on dividend income exceeding the prescribed limit under tax rules.
How to Invest in Flexi Cap Funds on Angel One?
Investing in the Flexi Cap Mutual Funds is an easy process when you do it through your Angel One account. Just follow these simple steps:
Step 1: Log in to your account on Angel One.
Step 2: Find a Flexi Cap fund that suits your needs and risk profile. You can learn more about the Flexi Funds on the Angel One app. Things to do at this stage are:
-
Search for the fund you want to invest in based on your preferred assets.
-
Analyse the fund’s past performance, tax impact, future potential, etc. You can calculate the potential returns using the mutual fund returns calculator.
-
Evaluate the fund’s level of risk, its ratings, lock-in period and expense ratio.
Step 3: Once you decide which Flexi Cap Fund you want to invest in, open your Angel One account, go to the Mutual Funds section, and buy the mutual fund’s units. The steps involved are:
-
Decide whether you want to invest via SIP or a lump sum one-time investment.
-
Choose a monthly SIP date. Enter the amount you want to invest and choose your preferred payment mode.
-
After placing the order, you can create an AutoPay to make hassle-free future instalments in case of SIP investments.
