New Delhi, Sept. 25 -- A good year can make almost any equity category look comfortable. That is partly why recent performance can be such a tempting place to begin when choosing a mutual fund. If one category has climbed faster than another, the obvious instinct is to pay attention to the one in front. The trouble is that the same comparison may look quite different a year or two later.

Large-cap and small-cap funds make this especially visible. They are both equity funds, but they do not fish in the same part of the market.

The formal boundary is based on market capitalisation. Under SEBI's mutual fund categorisation framework, the first 100 companies by full market capitalisation are large caps, companies ranked 101st to 250th are mi...