Mumbai, Nov 6 (IANS): The Securities and Exchange Board of India (SEBI) has introduced -- Flexi Cap Fund -- a new category for mutual funds under equity schemes.

It would be an open ended dynamic equity scheme investing across large cap, mid cap, small cap stocks. The AMC shall ensure that a suitable benchmark is adopted for the Flexi Cap Fund.

In the 'Flexi Cap Fund', minimum investment in equity and equity related instruments should be 65 per cent of total assets.

"In order to give more flexibility to the mutual funds and taking into account the recommendations of Mutual Fund Advisory Committee (MFAC), a new category named 'Flexi Cap Fund' under Equity Schemes will be available with the following scheme characteristics," an SEBI circular said.

For easy identification by investors and in order to bring uniformity in names of schemes for a particular category across mutual funds, the scheme name shall be the same as the scheme category.

Mutual funds have the option to convert an existing scheme into a Flexi Cap Fund subject to compliance with the requirement for change in fundamental attributes of the scheme in terms of Regulation 18(15A) of SEBI (Mutual Funds) Regulations, 1996, said the circular.

Scheme under the new category can be launched with effect from the date of this circular.