Shift 25% large-cap allocation to ETFs and choose consistent performers

Even over the longer term, active fund managers have found it difficult to outperform their benchmarks

Over the past year, only two of the 32 actively managed large-cap funds have outperformed their benchmarks (see table). Studies in the past - such as the one by Edelweiss Mutual Fund (MF) - have shown that outperformance within the large-cap space has been shrinking for the past few years. 

Regulatory changes made in the past couple of years have made it harder for large-cap fund managers to beat their benchmarks. One is the scheme categorisation norms introduced by the Securities and Exchange Board of India (Sebi) in October 2017. 

Earlier,