A small-cap value fund that lets winners run can find itself holding mid-cap growth names three years later. The drift may even help returns for a while, but it breaks the investor's asset allocation: someone who bought the fund as their small-value sleeve now has an unintended overlap with their large-growth sleeve.
Drift can be passive (holdings appreciate out of the category), deliberate (chasing what is working), or definitional (the index itself changed). Style analysis regressions against factor benchmarks will usually reveal it before the holdings list does.
The practical defence is periodic verification against the mandate, and treating a drifting fund as a new decision rather than an existing one. See investment-policy-statement and factor-investing.
Related: investment-policy-statement, factor-investing, active-share, benchmark, value-factor, size-factor