If an equity mutual fund scheme gives you a return of 30% in a year, is it a good or a bad scheme? On it’s own, it looks good. But every fund is meant to compare its returns against a benchmark index, which it aims to, and should, outperform. That is the dilemma that large-cap schemes are facing these day.
Just 47% of large-cap schemes outperformed the S&P BSE 100 Total Returns Index (TRI) over a 3-year period, by the end of 2017, according to Morningstar India. In comparison, as of June 2016-end, 82% of large-cap funds outperformed S&P BSE 100 TRI. By the end of 2016, the score had dropped to 79%. Things are about to get tougher for large-cap funds.
