Multi-asset allocation funds: What is prompting fund houses to launch new schemes?
monetary policies involving higher interest rates to address inflation, persistent geopolitical tensions, and lingering disruptions in the supply chain. These factors collectively indicate a sustained state of disruption in the world economy throughout the current year. While inflation is exhibiting signs of alleviation in certain regions, it remains a substantial concern.
Central banks find themselves in a precarious position, navigating the delicate task of curbing inflation without inadvertently pushing economies into recession. Adapting to the evolving global scenario, mutual funds are adjusting their investment strategies. Rather than concentrating solely on equities or specific sectors, numerous asset management companies (AMCs) are advocating for investors to allocate their funds to multi-asset strategies.
Consider, for instance, the Bank of India Multi Asset Allocation Fund introduced on February 07 of the current year, or the recently launched HSBC Multi Asset Allocation Fund on the subsequent date. The latest addition to this category is the Mahindra Manulife Multi Asset Allocation Fund, launched on February 20 this year, intensifying the competition among fund houses to a whole new level. For those unfamiliar, multi-asset allocation in mutual funds entails the approach of investing in various asset classes within a single fund.
This encompasses, but is not restricted to: In mutual funds, multi-asset allocation entails distributing your funds across different asset classes within a singular fund. This strategy is designed to diversify your portfolio and potentially enhance risk management. Here's how it works.
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