Implication of residual investments on core portfolios

Investors in large-cap active funds are finding that a significant portion of their investments are going into non-equity assets. This means that instead of getting pure equity exposure, they are getting a mix of equity and other investments. This can be a concern for those who specifically choose large-cap active funds to gain equity exposure. It may impact investor confidence in these funds and affect the overall performance of the market.

Why it matters

The implication of residual investments on core portfolios is unclear. Residual investments may affect the performance of equity funds, but the impact depends on various factors.

Market impact

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