Bank of India Flexi Cap Fund: Legal Framework, Portfolio Rules, Costs and Income Tax Treatment

Scheme Identity and Governing Documents

The complete and accurate name of this scheme is Bank of India Flexi Cap Fund — it should not be referred to loosely as a generic Bank of India mutual fund product. The scheme is managed by Bank of India Investment Managers Private Limited, with Bank of India Trustee Services Private Limited serving in the trustee capacity. As an open-ended scheme, it permits ongoing purchases and redemptions subject to applicable business days, cut-off timings, prevailing liquidity conditions, and the terms set out in operative scheme documents.

A critical distinction must be drawn at the outset: units of this fund are not bank deposits. The fact that the fund name incorporates the name of a bank does not imply capital protection, principal guarantee, or assured returns of any kind.

The primary governing document reviewed for this analysis is the Scheme Information Document (SID) dated 28 November 2025. The Statement of Additional Information (SAI) provides mutual-fund-wide legal and operational disclosures applicable to the AMC's broader range of schemes. The Key Information Memorandum (KIM), periodic addenda, and monthly factsheets offer condensed and more frequently refreshed information. Where any documents appear to conflict, the document with the later effective date and any subsequent addenda take precedence. Portfolio snapshots, being dated disclosures, cannot be relied upon to determine current holdings or the prevailing expense ratio.

Important: Figures in the table above reflect the reviewed SID dated 28 November 2025. Always verify against the latest addenda and official AMC disclosures before taking any action.

Investment Objective and Regulatory Allocation Framework

The scheme's stated investment objective is long-term capital appreciation through predominant investment in equity and equity-related securities spanning multiple market capitalisations. This wording represents an objective, not a contractual commitment by the AMC or the trustee. There is no guarantee that the objective will be achieved.

The flexi-cap categorisation — as defined under applicable SEBI regulations — permits the fund manager to vary the distribution of assets between large-cap, mid-cap, and small-cap companies within the regulatory framework. Critically, this does not require the manager to maintain any fixed proportion across those market-cap segments at all times. The regulatory flexibility is precisely what distinguishes the flexi-cap category from schemes with prescribed minimum allocations to a specific capitalisation band.

Under normal market conditions, the AMC describes an equity and equity-related allocation of 65% to 100% of scheme assets. The remaining portion may consist of cash equivalents, money-market instruments, and other permissible securities as described in the operative SID. Equity derivatives, where permitted, may be utilised in line with stated strategy and risk-management controls.

For analytical purposes, it matters whether a portfolio position represents cash equity, a hedged derivative exposure, or another instrument — each has different implications for gross exposure and volatility assessment. Because a flexi-cap mandate allows more substantial shifts in portfolio composition than a category with fixed market-cap floors, it also introduces manager-discretion risk alongside potential fluctuations in sector concentration, liquidity profile, and valuation sensitivity.

Performance and allocation should always be evaluated against the fund's own disclosed benchmark over comparable measurement periods — not against an unrelated index or an individual stock.

Benchmark, Portfolio Construction and Concentration Risk

The AMC has disclosed the BSE 500 TRI (Total Return Index) as the benchmark for this scheme. A total return index incorporates dividend reinvestment in its methodology, which makes it a more appropriate comparator for fund returns — which also benefit from reinvestment — than a price-only index.

When making any performance comparison, the following parameters must be specified:

• Whether the comparison involves the Direct Plan or Regular Plan
• Whether it involves the Growth option or IDCW option
• The exact return measurement date
• Whether returns are point-to-point or annualised

Since-inception performance figures can be distorted by differences in launch dates across competing schemes and should be interpreted with appropriate caution.