Investing in a balanced advantage fund can offer several benefits for investors. These funds are designed to provide a mix of equity and debt, aiming to strike a balance between risk and return. Here are some advantages of choosing a balanced advantage fund for your investment:
Risk management: Balanced advantage funds help in managing risk effectively by maintaining a balance between equity and debt instruments. This approach can be less volatile compared to investing solely in equities, providing a relatively stable investment journey.
Market flexibility: These funds have the flexibility to adjust their equity exposure based on market conditions. In bullish phases, the fund manager may increase equity allocation, while during bearish phases, they may lean towards debt. This adaptability can potentially enhance returns and protect against market downturns.
Relatively steady returns: The combination of equity and debt in balanced advantage funds aims to offer relatively reasonable returns over the long term. This can be particularly beneficial for investors looking for a balanced portfolio that provides growth potential while minimizing the impact of market fluctuations.
Asset allocation: Investors often face the challenge of deciding when to shift between equity and debt based on market movements. Balanced advantage funds simplify this process by employing dynamic asset allocation strategies, allowing the fund manager to make timely adjustments on behalf of investors.
Diversification: By investing in a mix of asset classes, these funds inherently provide diversification benefits. Diversification reduces the impact of poor performance in any single investment on the overall portfolio, contributing to a relatively stable and resilient investment strategy.
Professional management: Balanced advantage funds are actively managed by experienced fund managers who analyse market trends and economic indicators. This professional expertise can be valuable for investors who may not have the time or knowledge to actively manage their investments.
Tax Efficiency: Long-term capital gains from equity investments are often taxed at a lower rate compared to short-term gains. Since balanced advantage funds have substantial equity exposure, investors may benefit from favourable tax treatment on their returns, especially for investments held for an extended period.
Liquidity: These funds typically offer high liquidity, allowing investors to buy or sell units easily. This liquidity feature is advantageous for those who may need access to their funds in the short term or want the flexibility to adjust their investment based on changing financial goals.
Goal-based investing: Investors often have specific financial goals such as buying a home, funding education, or planning for retirement. Balanced advantage funds can be aligned with these goals, providing a disciplined and systematic approach to wealth creation over the long term.
Simplicity for investors: One of the key benefits of balanced advantage funds is their simplicity. Investors do not need to actively manage their asset allocation or constantly monitor market conditions. This simplicity makes these funds suitable for both novice and experienced investors seeking a hassle-free investment option.
In conclusion, investing in a balanced advantage fund can offer a range of advantages, including risk management, relatively steady returns, automatic asset allocation, and the expertise of professional fund managers. With its simplicity and flexibility, this investment option can be a prudent choice for individuals looking to build a diversified and goal-oriented portfolio. If you are looking to invest in a balanced advantage fund, you can consider opting for Bajaj Finserv Balanced Advantage Fund by Bajaj Finserv AMC. This scheme by Bajaj Finserv AMC comes with a behavioural edge, as it combines financial strategies with a deep understanding of investor behaviour. This fund aims to transform investment decisions by addressing challenges posed by emotions like greed and fear. Visit the official Bajaj Finserv AMC website to learn more about this scheme and to start your investment.
About Bajaj Finserv Asset Management Ltd.
Bajaj Finserv Asset Management Limited, a wholly-owned subsidiary of Bajaj Finserv Limited, has announced its presence in the investment solutions industry. Backed by one of India’s most respected and oldest brands, it offers a host of innovative products and solutions to every Indian. With a future-focused and differentiated investment strategy, its ambition is to help every Indian achieve his/her financial goals.
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.