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About 75% diversified equity schemes trail benchmark index: Study

Experts believe some funds may have had to reallocate their portfolios because of categorisation, and were unable to focus on their investment objectives



Ashley Coutinho Mumbai
Fund managers faced a tough time beating the benchmark in 2018, with nearly three in four diversified equity schemes underperforming their respective underlying indices.

A study of 235 equity schemes that includes direct plans shows that 168, or 71 per cent, have underperformed their respective benchmarks, observed Value Research.

Market observers have attributed this to large sums chasing too few stocks, and the impact of regulatory changes such as categorisation of schemes as well as the introduction of total returns index, in lieu of a simple price index.

"Too much money chasing too few stocks has resulted in divergence of

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First Published: Dec 31 2018 | 10:13 PM IST

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