If the global economy goes into a recession, earnings of Indian corporates could also be affected, especially those belonging to export-oriented sectors such as information technology and pharma. Hence, investors who are excessively exposed to equities should consider building a diversified portfolio that also includes debt and gold. If they don’t wish to build such a portfolio themselves, they may opt for a multi-asset allocation fund.
Currently there are 13 multi-asset allocation funds with total assets under management of Rs. 27,688.92 crore. According to the Securities and Exchange Board of India’s (Sebi) circular on categorisation of mutual funds (dated October 2017), multi-asset allocation funds are a category of hybrid schemes which must invest in at least three asset classes, with at least a 10 per cent allocation to each.
The primary benefit of investing in a multi-asset allocation fund is that you get access to a diversified portfolio. If you look at returns from the past, no asset class outperforms each year. Over the past five years, the outperforming asset classes were as follows: 10-year constant maturity gilt funds in 2018, US funds in 2019, small-cap funds in 2020 and 2021, and gold in 2022. If you are exposed to only one asset class, your portfolio may outperform in one year but underperform in others. To have a smoother journey, you need exposure to a diversified portfolio, which multi-asset allocation funds provide.
Denne historien er fra February 2023-utgaven av Investors India.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent ? Logg på
Denne historien er fra February 2023-utgaven av Investors India.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent? Logg på
5 Steps To Achieve Your Financial Goals
From a beach house, a Jaguar, to traveling the world – there are many things in life that we want to accomplish.
Microbiome: The Invisible Ecosystem Within us that Safeguards our Health
Imagine being able to heal yourself and build immunity against major diseases without relying on heavy medication. It sounds fantastic, right? Who wouldn’t want that? The key to achieving this lies in a fascinating area of research—our microbiome.
Gold ETFs: Attractive option for retail investors to take exposure to yellow metal
With the equity market experiencing volatility in August, investors are increasingly seeking to diversify their portfolios.
The Retail Revolution: How India's Stock Market Got a Makeover by the Common Man
In the annals of India’s financial history, the stock market has long been the playground of the big boys—mutual funds, insurance behemoths, and foreign portfolio investors (FPIs).
Strategies to adopt when the markets are at a high (for new and existing MF investors)
An investor must have a plan in place and, more importantly, stick to it regardless of shifting market conditions.
A Collaboration to keep Health FirstPNUT and IDA come together as One!
You reap what you sow! And if you sow health, you will reap a healthier tomorrow. Following the same lines, Personal Nutrition (PNUT) and Indian Dental Association (IDA) have come together as partners to promote complete health and nutrition for each individual! How things unfolded? Let’s explore.
Making a choice between equity and debt mutual funds for long-term goals
Mutual funds are quickly becoming a preferred investment choice for millennials.
ASK THE EXPERT
From last Financial Year, I have shifted to the new Tax Regime.
Flexi-cap Fund Vs Hybrid Fund
Investors in mutual funds can choose from equity, debt, or hybrid funds, each offering different risk and return profiles. Flexi-cap funds provide diversification across market capitalisations, while hybrid funds balance equity and debt for stable returns.
Neuroplasticity: You Can Teach An 'Old' Brain New Skill
A few decades ago, it was believed that the brain’s structure and functions were entirely dependent on genetics, age, and early childhood experiences.
