A multi-asset allocation fund is a type of hybrid fund. However, such a scheme does not just invest in debt and equity. Fund managers also choose one or more other avenues, such as gold, real estate or more.


Multi-asset allocation funds are also regulated as per the guidelines laid out by SEBI. One condition that these funds must satisfy is that more than 10% of the investment is allotted in at least three or more asset classes.


So, in simple terms, these funds are a type of hybrid fund with investment in multiple asset classes.

Benefits of Investing in a Multi-asset Allocation Fund

Investing in these funds comes with numerous benefits that help you maximise returns. 


Given below are some of the top advantages of a multi-asset allocation fund:

  • Helps in diversifying your portfolio and lower the risks to drive steady returns

  • Rebalances portfolio to divert investments as per market movements 

  • Leverages the expertise of experienced fund managers to protect your investment

  • Offers you a ready portfolio and helps avoid the hassles and risks of selecting diversified instruments on your own 

  • Gives you restriction-free entry and exit, provided you meet the redemption requirements 

Should You Consider Multi-asset Allocation Mutual Funds?

  • Multi-asset allocation schemes are less risky when it comes to hybrid funds. Thus, these funds could be ideal for investors looking to diversify their portfolios and lower their exposure to risk.

  • Given the way these funds perform and work, they could also be an ideal option if you want to stay invested for more than three years.

Things to Keep in Mind When Selecting Multi-asset Allocation Funds

There are a number of things you need to remember while choosing a scheme, even with multi-asset allocation funds. Here is a look into some of the top points you need to consider:

  • Assess your investment goals and risk tolerance before choosing a fund

  • Check and compare the past performance of funds and the experience of fund managers 

  • Consider the rank and allocation of the funds to ensure it aligns with your requirements

  • Remember your tax liability and invest accordingly to get the highest returns

  • Choose a fund that aligns with your investment horizon 


 Now that you know the meaning and key features of a multi-asset allocation fund, remember to assess your requirements and compare different schemes. This will help you choose the best option and set yourself up for success. 


You can invest in a multi-asset allocation mutual fund or other schemes with ease through Bajaj Markets. Choose from some of the top-performing funds and invest online in just a few clicks.


What is the meaning of a multi-asset allocation fund?

When mutual funds allocate investments in multiple asset classes, they are termed multi-asset allocation funds. In simple terms, the fund manager will invest in numerous securities, such as debt, equity, gold, and more. These funds help diversify your portfolio and mitigate the risks.

Is investing in multi-allocation funds good?

Whether multi-asset allocation funds are ideal for you or not depends on your portfolio and risk tolerance. Generally speaking, these funds can be a good investment avenue as they offer diversification and mitigate risk.

How does a multi-asset allocation fund work?

In these funds, the fund manager will invest in multiple asset classes. This includes debt, gold and gold securities, equity and equity-related instruments. 


It is not necessary for there to be an equal allocation among assets. One asset class may have more investment than the other. You can study the allocation and choose a scheme per your preference.

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