DSP Nifty 500 FlexiCap Quality 30 ETF NFO: How it differs from active flexi cap funds and key details

DSP Mutual Fund on Thursday, September 25, announced the launch of DSP Nifty 500 FlexiCap Quality 30 ETF, India’s first Flexi Cap Exchange Traded Fund (ETF).

The flexi-cap ETF will track Nifty 500 FlexiCap Quality 30 TRI, a benchmark that enables investment across large, mid, and small-cap companies while focusing only on quality businesses.

How is it different from active flexi-cap funds?

Flexi-cap funds have traditionally been active mutual funds where fund managers actively pick stocks for investments from the Nifty 500TRI universe. However, recently, some fund houses have started launching passive flexi-cap funds as well. Such funds passively track an index and try to replicate its performance.

DSP Nifty 500 FlexiCap Quality 30 ETF is a passive flexi-cap fund that can be traded on stock exchanges.

What the fund house says about the flexi-cap ETF

"Indian equity markets often move in cycles, with large, mid, and small caps taking turns to outperform. For most investors, deciding where to invest, how much to allocate, and when to switch can be both difficult and costly," DSP Mutual Fund said in a release.

"This ETF takes away that complexity. Using a transparent, rule-based framework, it automatically increases exposure to mid and small caps when they are in momentum and shifts towards large caps when they lead," it added.

The fund house further said that all stocks in this ETF will be chosen based on "strict quality filters, ensuring that investors remain anchored in fundamentally strong businesses."

Nifty 500 Flexi Cap Quality 30 Index returns since inception

Since its inception in October 2009, the Nifty 500 Flexi Cap Quality 30 Index has delivered a 17.6% CAGR, outperforming the Nifty 500 TRI across market cycles, according to the release.

"Its strength has come from combining dynamic allocation with a focus on quality and a concentrated 30-stock portfolio. Importantly, it has also cushioned investors during downturns. For instance, falling less than the broader market in 2011 and 2018, and limiting losses during the 2020 COVID crash while capturing the recovery that followed," DSP Mutual Fund said.

NFO dates

The New Fund Offer (NFO) will be open from September 25 to October 6, 2025.

Who may invest?

The flexi-cap ETF from DSP Mutual Fund may be suitable for investors seeking long-term capital growth through a single, convenient product that captures opportunities across market cycles, while maintaining the discipline of quality and the efficiency of a passive, low-cost structure.

“Flexibility and quality are two powerful ideas for long-term investing. With this ETF, we are offering investors a product that automatically adapts to market phases without the need for constant monitoring or switching. At the same time, by focusing only on quality businesses, the ETF aims to give investors confidence that their money is invested in companies built to last,” said Anil Ghelani, CFA, and Head of Passive Investments & Products at DSP Mutual Fund.

"A true-to-label Flexi Cap strategy has been missing in the Indian market. Most of the diversified or Flexi Cap Funds tend to stay within narrow ranges of allocations towards mid and small caps. With the DSP Nifty 500 FlexiCap Quality 30 ETF, investors finally have a simple, transparent and low-cost way to gain exposure across large, mid, and small caps in a single fund. It may provide an all-weather solution for long-term wealth creation,” said Gurjeet Kalra, Business Head, Passive Funds, DSP Mutual Fund.