Introducing HDFC Balanced Advantage Fund
This is an open-ended Balanced Advantage Fund of HDFC Mutual Fund. It was launched on September 11, 2000. HDFC Balanced Advantage Fund aims to achieve capital appreciation over a long period. The fund provides a balanced approach between stability and growth. It helps you to navigate volatility in the market, mixing equity and debt wisely.
Moreover, it has a unique feature to switch assets between equities and debts according to market situations. This fund attracts long-term wealth creation. The fund manages risk and pursues profits during the inflation period. The fund managers use their experience and analyze equity and debt separately. That results in the fund achieving its goal through dynamic asset allocation. Moreover, with a balance between growth and risk management.
Moving a step ahead to look at this fund by understanding its benefits, disadvantages, etc.
What are the Benefits of the HDFC Balanced Advantage Fund?
Here are the benefits of the fund mentioned below:
- Hedging: The asset allocation process works as a hedge. It balances your financial status. and mitigates the risk during the inflation period.
- Low Volatility:It is less volatile as compared to pure equity funds. This provides you with stability and growth in the market.
- Diversification: This fund consists of both equity and debt securities. That gives you exposure to invest in both. Investments in this fund provide you with a diversified portfolio.
- Flexibility: There is a flexible shifting of assets in this fund, which helps balance market valuations and achieve the target.
- Management: The financial experts keep monitoring the funds. They manage the shifting of assets to achieve the economic goal. Additionally, they support you in making strategies for your future upliftment.
- Growth Potential: The HDFC Balanced Advantage Fund has both equity and debt investments. This gives you the potential to grow for a long-term horizon. Furthermore, it provides you with stability from its good returns.
- Liquidity: This is an open-ended fund. This means it has the facility of liquidity. In simple words, whenever you wish you can invest and redeem your money.
Moving forward with the good points let’s take a look at the other side which require a little more focus.
What are the disadvantages of the HDFC Balanced Advantage Fund?
Here are the following points that need a little more focus:
- Expense Ratio: The investment in this fund requires more research, operations, and analysis. This automatically makes the expenses high. That ultimately, reduces your returns over time.
- Variation in Performance: The fund manager should have proper knowledge of market swings. The returns depend on the manager’s asset shifting. In simple words, the performance and returns will suffer if shifting is not done properly with market movements.
- Return Risk: The debt part of this fund is affected by the change in its interest rate. That means it provides you with lower returns when the interest rate goes higher. That ultimately, makes the fund underperformed.
- Complex Strategy: The fund has a dynamic asset allocation strategy. This strategy is sensitive and not easy for all investors to understand. The lack of transparency makes the returns and performance of funds down.
Move ahead to know who is suitable for investing in this fund.
Who can invest in the HDFC Balanced Advantage Fund?
The following points give you a brief insight to check whether this mutual fund is suitable for you or not:
- Long-term seekers: This fund typically supports steady growth. If you wish to be part of the market for a long-term race and stay positioned in the market. Then this fund is good for investing.
- Diversification seekers: These funds have a variety of investments within them. These funds allow you to explore various sectors. If you are the one who has an interest in exploring and wants to make your portfolio rare. Then you can consider these funds for investments.
- High-Return seekers: The equity part of this balanced fund gives you high returns. If you want to uplift your growth and wish for more earnings then this fund suits you.
- Stability seekers: Along with high growth, HDFC Balanced Advantage Fund gives you financial stability. If you are a retiree or near-retirees, and one who wishes to be stable financially then this fund is suitable for you.
- Risk-tolerant: This fund benefits more to lower-risk investors. If you have a low-risk tolerance and want capital appreciation then this fund well suits you.
Moving a step ahead to go through with the summary of this brief description.
Conclusion
This quick review gives you a summary that this is an amazing scheme with balance of growth and stability. The scheme gives you moderate returns. Furthermore, it balances your loss risks by dynamic asset allocations.
You have the advantage of going with the SIP investment route for investing in this scheme. This route reduces your market risks. Also, this gives you the option to start with a fixed small amount. You can invest at regular intervals. Investing through this route makes your habit of savings strong.