Kolkata: Sir Garfield Sobers was known as a “three-in-one” cricketer — a batsman, bowler (both fast-medium and spin) and fielder. In short, he was perhaps the greatest all-rounder to grace the game. In the world of investment, a multi-asset fund is somewhat similar to an all-rounder on the cricket field. Multi-asset funds can be so significant in the investment journey of an individual that Dhirendra Kumar, founder & CEO, Value Research, Nilesh Shah, MD, Kotak Mahindra Asset management Company and Deepak Shenoy, founder & CE, Capitalmind recommended from the platform of TV9 WITT 2025 that multi-asset funds can be a brilliant instrument for mutual fund investors, so much so that a beginner can be served well by only this category of fund for about 10 years.
“If someone is in his/her forties and is beginning to invest in mutual funds, just a multi asset fund is fine for 10 years,” said Dhirendra Kumar who has been a keen student of mutual funds for well over three decades now. Let’s see what are multi-asset funds and how an investor can benefit from them.
What are multi-asset allocation funds
Multi-asset allocation funds are the all-rounders of the mutual fund industry — through a single investment an individual into debt, equity and another field such as precious metals or real estate. Moreover, modern day algorithms tune multi-asset allocation funds to respond to changing market conditions and different trends in returns to different asset classes. In short, these funds allow an individual to achieve diversification in their portfolio by investing in multiple assets with a single investment and thereby contain risk.
Sebi states that a multi-asset allocation fund has to invest in at least three asset classes and allocate a minimum of 10% in each asset class. The fund manager, therefore, has the flexibility to keep changing allocation in differengt asset classes to maximise returns and minimise risk.
Who should invest
Experts are of the opinion that multi-asset allocation funds are eminently suitable for investors with low-risk appetite but are focussed on steady returns on investments in different market conditions. Even when one or two asset classes underperform, the third one will keep the rocking returns boat steady. Therefore, the risks are evened out. Experts also underscore the need to rebalance portfolio from time to time. Multi-asset allocation funds can do portfolio rebalancing helping them to tackle volatility in the market.
(Disclaimer: This article is only meant to provide information. News9 does not recommend buying or selling shares or subscriptions of any IPO, Mutual Funds, precious metals and crypto assets.)
Mutual fund market titans such as Dhirendra Kumar and Nilesh Shah recommended multi-asset fund strongly for investors, especially beginners. Read on to find out why are they valued do much. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
