Active Mutual Funds fails to beat their benchmark returns

Active Mutual Funds fails to beat their benchmark returns

Active Mutual funds again slipped to beat their benchmark returns in 2020. As per the source, up to 81% of large-cap equity indices underperformed the S&P BSE 100 index. On the other hand, ELSS funds, Mid-cap, Small-cap, and government bond funds also underperformed to its benchmark indices over the one year.

Further, Equity markets raised after the pandemic. According to the source, in the last year, S&P BSE 100 raised 16.84% with 80.65% of funds underperforming the benchmark. During the second half of 2020, 100% of the funds failed to beat the benchmark S&P BSE 100.

During the same period, S&P BSE 200 index raised 17.92%. It outperformed 65.12% of the actively managed funds in the category. Likewise, S&P BSE 400 Mid and Small-cap Index reported a 26.76% gain at the end of December 2020. Moreover, 67% of the mid and small-cap funds deserted to follow such progress.

Besides, Fixed income securities like government bond funds had also failed as compared to the S&P BSE India government bond index. At that time, 90% of composite bond funds failed the performance of the S&P India Bond Index.

Over the 3-year and 5-year period, 87% of large-cap funds underperformed their benchmark indices BSE 100. Whereas in 3-year and 10-year time period, 35% of mid and small-cap equity schemes performed better than their benchmark. Nevertheless, in a 5-year period, 54% of mid and small-cap funds underperformed to indices. However, 100% of the large-cap funds, 80% of the ELSS funds, and 53% of the mid-cap and small-cap funds underperformed their corresponding benchmarks.

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