Eight of 10 diversified equity schemes lag benchmark in past year

Categorisation of schemes and the introduction of TRI have also pulled down returns for some schemes

It’s not an easy time to be an equity fund manager. Nearly 80 per cent of diversified equity schemes have underperformed their respective benchmark indices over the past year.

A study of 392 equity schemes — including direct plans — shows that 310, or 79 per cent, have underperformed their respective benchmarks, shows data by Value Research.

Market observers have attributed this to large sums of money 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