The flow of assets to passive products over the last several years has increased the pressure on active mutual funds. Analysts are predicting an industry consolidation with the prime target being those funds that track an index but charge relatively high active management fees – the so-called closet-index funds. Here are the 10 largest such U.S. large-cap equity funds.

The data for this analysis was provided by Morningstar. The criteria I used to identify those funds were the following:

  1. The fund was classified by Morningstar as a U.S. large-cap fund (value, growth or core) and had at least five years of performance history.
  1. The fund was not classified by Morningstar as an index fund.
  1. The oldest share class for the fund was selected.
  1. The five-year average tracking error to the fund’s Morningstar Category Index was less than 1.5%, which means it was in the bottom 5% of tracking errors for large-cap funds.
  1. The five-year average expense ratio was more than 0.75%, which is above the average expense ratio of all U.S. equity funds (0.70%).