Majority of large cap equity mutual funds underperformed benchmark in 2022

In 2022, most large-cap equity mutual funds did worse than their benchmark. According to an S&P Dow Jones Indices report, 88% of actively managed Indian large-cap equities mutual funds lagged the S&P BSE 100 in 2022, failing to outperform the benchmark. The S&P BSE Mid Small Cap index, the benchmark for Indian equity Mid-Small-Cap funds, increased by 2% in 2022, and 55% of active managers underperformed in the market. Additionally, the S&P BSE 200 increased by 6% in 2022, and 77% of Indian ELSS (equity-linked savings plans) funds outperformed the index. Indian Composite Bond funds did the best, trailing the S&P BSE India Bond index by only 45%, according to the S&P Indices Versus Active (SPIVA) Funds India Scorecard for 2022. Although the primary stock and fixed income benchmark indexes declined in the first half of 2022, they mounted a stunning rebound in the year's second half. Indian markets performed significantly better than most global markets. The S&P BSE 500 Mid Small Cap index underperformed the S&P BSE 200 by 4%, the most since 2019, due to tighter lending rules. According to the research, the S&P BSE India Government Bond index increased by approximately 3% in 2022. Fascinatingly, only 36% of active managers outperformed the benchmark in 2022, with a 68% underperformance rate. According to the scorecard, Indian Equity Mid-Small Cap funds performed the best over the long term among all categories, surpassing the S&P BSE Mid-Small Cap Index by 50% over the 10 years ending in December 2022. According to the S&P Dow Jones Indices study on actively managed mutual funds, Indian ELSS funds had the second-highest long-term survival rates of any category in the SPIVA India Scorecard, with 78% still existing after ten years.