The financial year gone by, FY19, has been a landmark one for the mutual funds industry as well as investors. The re-categorization of schemes was implemented around the start of the year with schemes moving into category buckets clearly defined by the Securities and Exchange Board of India (Sebi). Around halfway through the year, problems in certain corporate groups and their consequent debt defaults or downgrades shook the industry, particular debt funds which held troubled papers. Interest rates rose sharply in the first two quarters of FY19, but moderated and reversed in the last two, spurring a rally in long-duration funds, even as their credit risk peers languished. In equity, large-cap funds put in a respectable performance even as mid- and small-cap funds failed to deliver.
