Latest news with #MultiAssetAllocationFund
Economic Times
31-07-2025
- Business
- Economic Times
NFO Insight: Can this multi asset allocation fund help diversify your portfolio?
360 One Mutual Fund introduces its Multi Asset Allocation Fund. Subscription is open until August 13. 360 One Mutual Fund's latest new fund offer of 360 One Multi Asset Allocation Fund is open for subscription and will close on August 13. The fund is an open-ended scheme that invests in a diversified portfolio of equities, debt, commodities, and assets such as REITs and InvITs. According to the fund house, this multi asset allocation fund addresses the need for portfolio diversification amid increasing geopolitical instability, currency fluctuations, and global economic challenges and by investing across asset classes with varying correlations, the fund aims to deliver a smoother investment journey and counterbalance market volatility. Also Read | NFO Insight: Capitalmind Mutual Fund's flexi cap fund opens for subscription. Will it help to manage current market volatility? The fund is benchmarked against a composite index of BSE 500 TRI (25%), NIFTY Composite Debt Index (45%), and domestic gold and silver prices (30%). The fund is managed by Mayur Patel, Milan Mody, and Rahul minimum investment amount during the NFO is Rs 1,000 and in multiples of Re 1 thereafter. For SIP investments, the minimum application amount is Rs 1,000 and in multiples of Re 1 thereafter. The fund has an exit load structure of 1% if units beyond 10% are redeemed within one year from allotment, while no exit load is applicable for units redeemed after one year from allotment. "The 360 ONE Multi Asset Allocation Fund embodies our commitment to providing innovative solutions tailored to investors' evolving needs. By diversifying across asset classes, we aim to mitigate risk and create sustainable value for our clients in an ever-changing global environment,' said Raghav Iyengar, CEO of 360 ONE Asset Mutual Fund.'With this fund, we are not only expanding our robust portfolio of investment products but also empowering investors to navigate market complexities with confidence. This is another step in our journey to redefine the investment landscape in India," Iyengar typically ask investors to avoid investing in NFOs unless they offer something unique. The uniqueness could be that the scheme is offering an investment option that is not available in the market or offering something extra to an existing option. Otherwise, the experts believe investors are better off with an existing scheme with a long performance record. This is because you have some historical data to base your investment decision. You don't have any data when it comes to new expert is of the opinion that one should avoid investing in NFOs as no track record is available and we should consider only if we are convinced that the fund fulfills the purpose of your investing.'An NFO does not have a track record, so investment should be considered only if we are convinced with the philosophy of the fund manager and if the taxation rules are also in line with our expectations,' Rajesh Minocha, a Certified Financial Planner (CFP), Founder of Financial Radiance shared with ETMutualFunds. Also Read | MF Tracker: Can this multi asset fund with top sharpe ratio sustain its outperformance? Sharing a similar opinion another expert also mentioned that NFOs are generally best avoided and unlike IPOs, NFOs offer no price advantage.'NFOs are generally best avoided, as they lack a performance track record and the fund manager's strategy is often unclear. Unlike IPOs, NFOs offer no price advantage. Given the wide range of funds available from diversified categories with historical track record, investors are better off choosing from existing options,' Chethan Shenoy, Executive Director & Head - Product & Research at Anand Rathi Wealth Limited told fund follows a dynamic asset allocation framework with investments across multiple asset classes, including 15% to 35% in equities to target long-term growth, 25% to 50% in debt instruments for relative stability, 25% to 40% in gold and silver as a hedge against global uncertainties, and 0-10% in in REITs and InvITs to provide exposure to real fund is suitable for investors seeking to create wealth and income in the long term and who want investment in multiple asset allocation funds are hybrid funds that need to invest a minimum of 10% in at least 3 asset classes. These funds typically have a combination of equity, debt, and gold. Some schemes also add international equities, InvITs and equity allocation in the case of multi-asset funds could vary between 0-70%. Aggressive multi-asset funds could typically have 50-65% equity while the conservative ones could have between 35-50%. In the case of multi-asset funds, some schemes that allocate more than 65% to equity enjoy equity while mentioning that the multi asset allocation funds are suitable for moderate risk investors, he adds that these funds offer better downside protection especially when the markets get a bit volatile. 'Through diversification across asset classes, these funds lower the volatility of the portfolio. Gold and debt provide a cushion when the equity markets correct, thus the downside protection offered is more than what an equity fund can do. However, in the past, there have been unusual activities like equity and gold going up at the same time that has provided extra-ordinary returns to investors, sometimes even better than equity. Investors should set their expectations realistically,' he added. Also Read | Confused about investment in stocks, gold & silver? Simplify it with multi-asset mutual funds! On the other hand, Shenoy shares a different opinion. According to him though these funds aim to balance risk and return by spreading investments across different asset classes however, the diversification offered is not ideal as the investor has no control over how much is allocated to each asset and cannot adjust exposure based on personal goals or risk appetite. 'These funds follow preset allocations, limiting their ability to protect against losses during market corrections. True downside protection requires dynamic rebalancing, which is better achieved by managing equity and debt exposure separately. Relying on a static fund structure offers limited flexibility and minimal protection in volatile phases,' Shenoy to the Sebi mandate, multi asset allocation funds invest in at least three asset classes with a minimum allocation of at least 10% each in all three asset classes. For investors willing to invest separately in equity, debt, and gold funds against multi-asset allocation funds, Shenoy believes that compared to building a portfolio with pure-play equity, debt, and gold funds, multi-asset allocation funds give investors less control and adaptability and when you invest individually, you can adjust your exposure to each asset class as per your financial goals and risk further said that multi-asset funds, by contrast, lock you into the manager's allocation, which can lead to missed opportunities and redundancy if you already have a defined asset mix and they also limit visibility into the portfolio's market capitalization exposure, which even adding two or more multi-asset funds won't resolve. 'In most cases, investors are better off avoiding these and directly managing their equity and debt allocations,' he the contrary, Minocha has different points of view where he believes that multi asset funds provide an easy and hassle-free way of rebalance that investors may find hard to do on their own and separate investments allow more control and can possibly work out to be cheaper, while requiring constant monitoring and discipline. Around 23 multi asset funds have marked their presence in the market in the last one year of which WOC Multi Asset Allocation Fund has offered the highest return of 15.23%, followed by DSP Multi Asset Allocation Fund which offered a return of 12.39% in the last one year. ICICI Pru Multi-Asset Fund, the largest multi asset allocation fund, delivered a return of 8.50% in the said time period. HSBC Multi Asset Allocation Fund was the last one to offer a positive return of around 2.16%. And lastly, only Shriram Multi Asset Allocation Fund gave a negative return in the last one year of around 6.33%. Also Read | 13 equity mutual funds with over Rs 1,000 NAV offer up to 24% CAGR since their inception Post witnessing the recent performance, Minocha mentioned that the outlook of multi asset funds is very positive. 'In uncertain markets, diversified strategies contingent to smooth returns are a blessing for long-term investors looking for the limelight on both growth and stability. They serve well for people who don't like to get their hands dirty and need consistent and ordinary returns beating the inflation and providing them additional alpha over traditional products like fixed deposits,' he with a different opinion, Shenoy said if investors are already defining their asset mix at the overall portfolio level, adding a multi-asset allocation fund could lead to redundancy or concentration, especially if the fund is skewed toward equity.'Hence, investors should consider avoiding multi-asset allocation funds and instead opt for individual exposure to equity and debt which allows for the ideal strategy for better returns, long term growth and wealth creation,' he should always invest based on their risk appetite, investment horizon, and goals. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle.
Time of India
17-05-2025
- Business
- Time of India
Flexi Cap vs. Multi Asset Allocation Mutual Funds: Which one is best for you?
Flexi cap funds Multi asset allocation funds Live Events Here are key differences between these two mutual fund categories Feature Flexi Cap Fund Multi Asset Allocation Fund Asset class focus Only equity (large, mid, small caps) Equity, Debt, Gold/Commodities SEBI Mandate Min. 65% in equity Min. 10% in each of 3 asset classes Risk Level Moderately high to high Moderate Return Potential Higher over long term Balanced returns, lower volatility Portfolio Management Active stock-picking across market caps Asset rebalancing among asset classes Investment Horizon 5+ years 3–5 years Which one suits you best? Way forward for these categories With the growing variety of mutual fund options, investors often face the dilemma of choosing the right type of fund for their goals. Two popular choices that offer diversification and dynamic strategies are Flexi Cap Funds and Multi Asset Allocation Funds. While they may seem similar in terms of flexibility and diversification, they cater to different investor needs and operate under different Cap Funds are equity-oriented mutual funds that invest across large-cap, mid-cap, and small-cap stocks. These funds are designed to give the fund manager complete flexibility in allocating investments across market capitalizations, based on prevailing market to the SEBI mandate, flexi cap funds must invest a minimum of 65% of their assets in equity. The remaining allocation can vary, allowing the manager to shift between large, mid, and small-cap segments as opportunities arise. These funds are ideal for investors who have a long-term investment horizon (at least five years) and are comfortable with moderate to high risk. The dynamic nature of these funds allows them to adapt to changing market trends, making them suitable for growth-oriented Asset Allocation Funds aim to reduce portfolio risk by investing in at least three different asset classes — typically equity, debt, and gold or other commodities. SEBI mandates that a minimum of 10% of the portfolio be invested in each asset class. These funds are automatically rebalanced to maintain the asset mix, offering both stability and diversification. Since they are not purely equity-focused, multi asset allocation funds tend to have lower volatility and are well-suited for moderate-risk investors who are looking for consistent returns over a medium to long-term horizon (3–5 years).Choosing between the two depends on your financial goals and risk appetite. If you are aiming for higher long-term growth and are comfortable with equity market fluctuations, a flexi cap fund may be the right choice. However, if you're seeking a balanced investment with exposure beyond equities and lower portfolio volatility, a multi asset allocation fund could be more appropriate. In fact, many investors may benefit from holding both in their portfolio, using flexi cap funds for growth and multi asset allocation funds for balance and both fund types offer flexibility and adaptability, understanding their core structure and objective is key to making the right investment decision. Matching your investment horizon and risk tolerance with the right fund category will help ensure a more effective and aligned the flexi cap funds, Rajesh Minocha, a Certified Financial Planner (CFP), Founder of Financial Radiance said that, 'A broad-based structural uptrend is yet to emerge. However, investors should continue to invest in flexi cap types of funds and let the fund managers do the stock picking of the sectors they are comfortable with. The selection of a good fund manager based on research and their investment philosophy will be very important.'While sharing the way forward for multi asset allocation funds, Vishal Dhawan, CEO, Plan Ahead Wealth Advisors, a wealth management firm in Mumbai comments that one can hold multi asset allocation funds in the portfolio especially in volatile markets as they can help preserve capital and deliver more stable returns over time compared to pure equity funds.'Gold, for instance, has emerged as one of the strongest-performing asset classes in recent years, especially during times of global uncertainty. Its presence in the portfolio can act as a natural hedge, offering protection when equities are under pressure. However, it is important for investors to understand the fund's asset allocation model and strategy as this will influence how the fund performs across different market cycles,' he should always choose a scheme based on risk appetite, investment horizon, and goals.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle.
Time of India
14-05-2025
- Business
- Time of India
Mid & smallcaps will consolidate till earnings recover, says Shridatta Bhandwaldar
Shridatta Bhandwaldar , Head of Equities at Canara Robeco AMC, believes India's equity story needs a more balanced, professionally managed asset allocation approach. In this interview, he breaks down the rationale behind launching the Canara Robeco Multi Asset Allocation Fund and his outlook on small and midcap stocks. Edited excerpts: What was the core insight or market gap that inspired the launch of the Canara Robeco Multi Asset Allocation Fund—why now, and why this mix? Investors and households are persistently making asset allocation choices between – equities, fixed deposits, real estate, fixed income, precious metals etc. Fundamentally when you look at current asset allocation in a typical Indian household, it's skewed towards Fixed deposits and real estate. When you look at this skew – you know that there is a need for a professional approach to asset allocation to find a balance between risk and returns. Also, we observed that investors are either hyperactive or passive in their asset allocation approach. Fundamentally, Canara Robeco Multi Asset Allocation Fund will help investors to professionally manage asset allocation between equity & equity related instruments, debt instruments and Gold and Silver Exchange Traded Fund (ETF). We believe that there is a need for this product and as CRAMC, we can add value to investors through this category. Gross equity of 65% is chosen to ensure superior risk adjusted returns over period and equity taxation benefits. This apart, on 'why now'; in our opinion, Multi Asset Allocation Fund, being an all-weather category, timing the launch of the product has low relevance. Multi-asset strategies sound like the new black in a volatile world. How does your fund navigate the current global uncertainties—be it sticky inflation, shifting central bank tones, or geopolitical jitters? Canara Robeco Multi Asset Allocation Fund will be an interplay of equity (net equity of 30 %-80%, Gross equity of 65%), debt (10-25%) and precious metals (10-25% of Gold ETF/ Silver ETF). These assets have low or inverse co-relation with each other – thus reducing volatility of outcomes through cycles. While optimal equity allocation would help in enhancing returns through cycles; Gold ETF/Silver ETF and fixed income will enhance downside protection and act as a hedge against inflation / economic or geopolitical uncertainty respectively. This product is a good way to manage volatility and generate optimum returns across cycles. Investors love returns, but they hate surprises. What kind of risk-adjusted performance or consistency can investors realistically expect from this new fund? Based on category returns – one should expect returns in excess of fixed income with much lower volatility than any single asset class may generate. What's your call on equity valuations , especially in mid and small caps? Current valuations of mid and small caps are between 22-25x FY27 consensus earnings. This is 10%-15% higher than historical valuations and thus we expect consolidation in them till corporate earnings improve meaningfully. It is to be noted here that FY25 earnings growth has been low single digit so far. Are Indian markets priced for perfection, or do you still see underappreciated sectors where the story is just beginning? Large caps are largely in the fair value zone whereas mid and small caps continue to be expensive as highlighted in the previous question. Markets at all points in time have sectors which are expensive and others which are under-appreciated. We think pockets in discretionary consumption, financials and global cyclicals, building materials, etc. are under appreciated in the current market. Domestic SIP flows are holding the fort even when FIIs get cold feet. How sustainable is this retail resilience and can it shield us in the event of a global risk-off? Indian household's equity allocation through SIP has been resilient. If corporate earnings revive in FY26 from the current low single digit in FY25; this trend might continue for a longer period. These flows help in increasing our markets' resilience against global events. If you had to bet on just one theme for the next 12-18 months - be it consumption, manufacturing, AI, or energy transition—where would you place your chips? We don't think one should bet on one theme. We see markets in the next 12-18 months to be more bottom-up than top down and thus one needs to find out good opportunities across consumption, manufacturing and energy transition. There are limited plays on AI transition in India. One might find more bottom-up ideas in consumption over next 12-18 months against the other themes.
