Depends what you're doing, but I tend to use my index finger as a kinda substitute capo, and then play chords with middle, ring and pinky.

I used to use a capo sometimes, but it's restricting to not be able to use the are of neck behind it... to be honest now I rarely play acoustic, and even more rarely play open chords so it isn't an issue. Therefore when it comes along (as in 'Under the Bridge' when drunk) I make do without a capo for the increased freedom.