1. Dynamic Asset Allocation: Since a multi-cap fund has to invest a minimum percentage in the three different market cap ranges, a flexi-cap fund does not have this limitation. Therefore, the portfolio of such a fund can change very easily and according to whatever trend is happening in the markets at a particular time.

2. Risk Diversification: Since a flexi-cap fund invests across large-cap, mid-cap, and small-cap stocks, there is diversification in the risk aspect. A portfolio consisting of large caps can provide stability, and investments in mid and small-cap stocks will provide growth opportunities.