Mirae Asset Balanced Advantage Fund (NFO). Should you subscribe?
Mirae Asset Mutual Fund has launched it's new fund offer 'Mirae Asset Balanced Advantage Fund', which opened on 21st July will remain open till 3rd August 2022.
Before we know the details about the new fund offer(NFO), we should know what a balanced advantage fund is? As we know that equity market is volatile in nature, hence it is risky in nature, Investor who are looking for less risky investment can go for debt securities which are usually of low risk and low return investments. Return on debt securities may or may not beat the inflation. But those who are seeking good return as well as less risky investment can choose balanced advantage funds to get the maximum risk adjusted returns. As balanced advantage fund is a combination of equity and debt investments which are dynamic in nature. Balanced advantage fund is also called Dynamic asset allocation fund.
Mirae Asset balanced advantage fund is an open ended dynamic asset allocation fund, As per the current framework it's asset allocation would be like below
Equity (30-80%)
Arbitrage (0-35%)
Fixed Income (20-35%)
Taxation for this fund will be as of equity schemes as minimum 65% is allocated in equity and arbitrage. Model type will be the combination of P/B and P/E valuation of Nifty50 TRI Index.
As far as investment strategy (equity)is concerned it will follow BMV approach (focus on business-management-valuation), portfolio building will be done through bottom of approach. Stock selection process will follow flexicap framework with no market cap restriction. There will be no sector bias and flexibility to build portfolio on a risk adjusted return.
Though fortfolio building is done through flexicap framework but it will be large cap bias for better liquidity management.
Investment strategy (debt) will be buy and hold. It will invest in high quality credit assets AA+/AA securities. Debt part in it's portfolio will act like stabilising element in times of volatility.
Mirae Asset Balanced advantage fund will be managed by two fund managers, one for equity and one for debt. While equity portion will be managed by Mr Harshad Borawake, who has over 17 years of experience in fund management, he is also the head of research in Mirae Asset Mutual Fund. Mr Mahendra Jajoo will look after the debt part, he is also the CIO - fixed income, Mirae Asset Mutual Fund. He has over 15 years of experience in fund management.
Let's know the scheme details. Mirae Asset balanced advantage fund closes on 3rd Aug.This is an open ended dynamic asset allocation fund. The benchmark of the fund is Nifty 50 Hybrid Composite Debt 50:50 Index. While you can invest minimum Rs 5000/- as lumpsum investment and SIP of Rs 1000/- per month. Both regular and direct plans are available. If you want to exit from the scheme within one year from the date of purchasing, you have to pay an exit load of 1%.
Disclaimer - Mutual Fund investment are subject to market risks, read all scheme related documents carefully.
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