Why share of passives still remains small in India’s mutual fund industry
India is not on the brink of a passive takeover. To be sure, there are still instances of large-cap funds outperforming their benchmark indices, Ajay Pruthi, Sebi Registered Investment Advisor, says, “Most investors have a job and family, in between that, spending time to research is not possible for the average investor. Therefore, it is harder for investors to pick consistent outperformers in the category.” The more plausible destination is not a winner-take-all market but one increasingly split by terrain: passive funds possibly gaining their hold over large, well-covered, efficiently priced segments—large-cap equity, while active managers retain a claim over less efficient corners of the market.
