Quant funds are suitable for savvy investors with equity portfolio

They can substitute a portion of their large-cap funds with a mix of index ETFs and rule-based schemes

A few fund houses are in the process of launching quant-based schemes to remove human bias in stock-picking. DSP Mutual Fund’s (MF’s) DSP Quant Fund opened for subscription on May 20 and will close on June 3. ICICI Prudential MF has filed draft offer for its quant-based scheme with the Securities and Exchange Board of India (Sebi).

Quant-based schemes have a data-driven approach to stock-picking. They create a model on various parameters that automatically selects stocks. The idea is to free stock-picking from human intervention. The fund manager usually focuses on the robustness of the model. Each fund house develops