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India’s Top-performing Multi-Asset Allocation Funds


Mr Prayag wants to invest in Multi-Asset Allocation Funds, but he is unsure what it includes. He is worried because it is a significant decision to make. He learns that it contains more than one asset class and is used to build a portfolio and that the distribution of assets and their composition varies from one investor to the next.

Multi-asset allocation funds are hybrid fund that allocates at least 10% of its assets to at least three distinct asset classes. 

Mr Prayag has nothing to worry about since he can securely invest in the allocation funds. 

What is a Multi-Asset Allocation Fund, and how does it work?

Multi asset allocation mutual Funds are a type of mutual fund that invests in various asset classes. 

According to the Brinson study, asset allocation accounts for 93.4 per cent of a fund’s average performance. These plans are designed to provide investors with a stable income and capital appreciation by investing in a well-balanced portfolio of investments.

The Two Categories:

These funds can be further divided into the following categories:

  1. Funds with a high-risk tolerance.
  2. Funds with a target-date


An investor’s risk appetite determines the asset allocation of Risk Tolerance Funds. Investors with a higher risk appetite would be more likely to invest in equities, while cautious investors focus on a fixed income.

Benefits of These Funds:

  1. Portfolio rebalancing- It’s critical to rebalance your portfolio to ensure that your assets are evenly divided among the asset classes that outperform others. The allocation of several assets Automatic portfolio rebalancing is a feature of mutual funds that benefit investors in various ways. Because the market is prone to volatility, rebalancing your portfolio and reallocating assets is essential for navigating the ups and downs.
  2. Diversification- Multi asset allocation funds enables investors to expose their portfolios to different asset classes with various risk-reward factors. It facilitates investors to lower their risk and to derive steady earnings through different market cycles.
  3. Entry and exit are unrestricted- The fund does not charge an investment anything to join or depart the plan. If investors redeem 10% of their investment before the end of the year, they are eligible for free admission and exit. If the investment balance is not redeemed within a year, an exit load of 1% is applied. However, if it is exchanged after a year, there is no exit load.


Although the multi-asset allocation fund has not gone through a complete market cycle, it is possible to generate significant returns in a short period. Investors with knowledge of asset allocation and portfolio rebalancing may be able to get the most out of these products.

Multi Asset Allocation Funds and Their Risks:

The risks connected with a multi asset allocation fund are pretty minimal. This is because these funds’ portfolios are constructed so that they invest at least 10% of their assets in at least three distinct asset classes. This reduces the danger of concentration and provides you with the advantage of exposure to a diverse portfolio.

Market risk, volatility risk, and concentration risk are all present in the stock components of these products. Liquidity, credit, and volatility are all included in debt components. If the asset allocation fund is exposed to gold, the volatility of the gold price might impact the fund. If the fund has made real estate investments, there is a danger of liquidity.

What to think about before investing in multi asset management

Before investing in  multi asset management funds, there are a few things one should think about:

 Equity exposure: If one doesn’t want to take on more risk, they can try investing in a multi-asset management fund with low exposure to stock. 

  1. Taxability: One must understand how taxed the money you choose to invest. If one doesn’t, they will be in for a rude awakening when it comes time to redeem the units. 
  2. Investment horizon: If the investment horizon is more than three years, multi-asset allocation funds are a good choice.


Some Top Multi-Asset Allocation Funds:

Nippon India Multi Cap Fund – The nippon india multi cap fund is a mutual fund that invests in India. Nippon India Multi Cap Fund’s performance as of November 30, 2021 % CAGR over a year CAGR% for 3 years, CAGR% for 5 years, CAGR% for 10 years, CAGR% for 20 years since the beginning.

Aditya Birla Sun Life Multi Cap Fund – The aditya birla sun life multi cap fund fund is invested in Indian stocks 95.56 per cent of the time, with 39.13 per cent in big size stocks, 17.64 per cent in mid-cap stocks and 22.79 per cent in small cap equities. It is suitable for investors seeking a solid return on their money for at least 3-4 years. However, these investors should be prepared for the risk of moderate losses in their assets.


Balanced mutual funds that invest at least 10% of their portfolio in three or more asset classes are multi asset allocation funds. These funds’ asset allocations often comprise securities from both the equity and debt markets and gold, real estate, and other assets. The multi asset management funds are a solid alternative for anyone wishing to diversify their portfolio by acquiring exposure to a range of asset classes.

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