Time to churn for cost conscious after introduction of total return index

The Securities and Exchange Board of India (Sebi) has made it compulsory for all mutual funds to benchmark their schemes against the total return index (TRI) through a circular dated January 4. Until now, a few fund houses such as DSP BlackRock, Edelweiss and Quantum were voluntarily benchmarking their returns against the TRI. But now all fund houses will have to adopt this global best practice.

Price return indices (PRIs), which fund houses have been using so far, capture only the capital gains and losses of the index constituents. But funds also receive dividend payments from the securities they hold in