IME Capital Investment Queries provide answers to common investor queries that are directly written by IME Capital’s Central Investment Team. This helps ensure centralised, common and transparent communication of our thoughts to all investors (& potential investors) of IME Capital, and helps mitigate against the disparate communication common in the wealth management industry. Please note, that the answers to these queries can be time/market-condition sensitive, or only applicable to specific types of investors.
Written by IME Capital’s Investor Desk on March 9, 2025 | Category: Equity
Flexicap funds are equity funds that are allowed to invest in any proportion of large, mid & small-cap companies. This gives the fund manager the flexibility to position his portfolio across market-capitalisations, based on evolving market conditions.
Multicap funds on the other hand, need to at times maintain a minimum of 25% each in large, mid & small-cap companies respectively. Under this category, fund managers are forced to maintain a minimum 25% in each market-cap segment, even if the view is that one of these segments is not attractive in the given market context.
In most cases, a flexicap fund would be preferable to a multicap, given the greater flexibility that this category gives fund managers to position their portfolios. However, if from an asset allocation perspective, you wish to ensure that a certain minimum will always maintained in each of these 3 market-cap segments, you may find a multi-cap fund to be more preferable.