Key Highlights
- (AI-generated image)SummaryFlexi-cap funds may offer diversification without forcing exposure to expensive market segments.
- But these are not the only ones that promise diversification across market caps. Investor money has swung decisively towards flexi-cap funds in recent months.
- From May to November 2025, flexi-cap schemes accounted for 28.7% of total net inflows into diversified equity mutual fund categories. The timing of this surge is telling.
- After a prolonged rally in mid- and small-cap stocks, valuation comfort has begun to shift back towards large-caps.
- As a result, flexi-cap funds, by virtue of their tilt towards large-cap stocks, have started to outperform others. This has reinforced a popular belief among investors: flexi-cap funds offer diversification without forcing exposure to expensive segments of the market.
