Flexi-Cap Funds- A great opportunity to gain

What is flexi-cap funds? 

Flexi-cap funds have the flexibility to invest in large-cap, mid-cap, and small-cap stocks based on market conditions. Investors should consider their financial goals, risk-reward, and investment horizon before choosing this category

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Flexi cap fund is one of the oldest categories and is popular among investors.

Flexi-cap funds are allowed to invest across market caps as per the market situation. They have the flexibility to invest in large-cap, mid-cap, and small-cap stocks based on market conditions. Thus, the fund manager can choose to invest in companies of different market capitalizations, depending on their assessment of the market.

 

Flexi-cap funds are pure equity funds that can invest across the entire market without any caps. Due to their higher equity exposure, these funds are more volatile but also have the potential to generate better returns in the long run.

“Flexi cap fund is one of the oldest categories and is popular among investors. Investors choose this category as an investment with the sense that their funds are deployed across the market and they need not take any other category separately,” Before investing in flexi-cap funds, investors should consider crucial factors to make informed choice.  As per him, investors should consider these factors before investing in flexi-caps.

1)Since flexi cap funds are allowed to invest across market cap as per the market situations, for a 1st-time investor, it is advisable to go through the balance advantage fund route as these are more stable and less volatile compared to a flexi cap fund which is 100% equity-oriented.

2) Most of the flexi cap funds are large cap oriented currently although they can move across the market cap. 

3)The exposure to mid and small-cap is limited compared to the flexibility given to this category. 

4)One needs to understand their financial goal and risk-reward along with their investment horizon to choose any of the categories

Meanwhile, investors are placing significant bets on systematic investment plans (SIPs), with inflows rising to ₹1.66 lakh crore in the first 11 months of 2023, as per data from the Association of Mutual Funds in India (AMFI).

The total invested in the first 11 months this year is way higher than ₹1.5 lakh crore through the route in the entire 2022, ₹1.14 lakh crore in 2021, and ₹97,000 crore in 2020.