2 Best 5-Star Rated Dynamic Asset Allocation Funds For SIP In 2021

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oi-Vipul Das

| Published: Saturday, November 20, 2021, 16:38 [IST]

Owing to the market being at an all-time high we predict there will be a downturn caused to overvalued and looming price valuations, and its resulting mutual fund investments in Dynamic Asset Allocation or Balanced Advantage Funds within the Hybrid Scheme category have seen a solid inflow. According to the data of the Association of Mutual Funds in India (AMFI), Dynamic Asset Allocation funds witnessed the highest positive inflow of Rs 11,219.25 Cr under the Hybrid Scheme category as of October 2021. The Net Assets Under Management of Dynamic Asset Allocation funds reached a high of Rs 1,61,393.11 crore in October 2021, while the average Net Assets Under Management was Rs 1,56,944.04 crore. After balanced hybrid funds, Dynamic Asset Allocation funds also recorded the second-highest folios of 37,85,745 for the month of October 2021.

Should I start SIP In Dynamic Asset Allocation funds?

Based on the market movements, Dynamic asset allocation funds, also known as balanced advantage funds, actively manage their allocation towards equity and debt stocks. As a result, investing in these funds can give you a long-term wealth potential as well as a cushion against the downside in case of falling equity markets.

According to the performance report of ICRA Analytics Ltd, Dynamic Asset Allocation Funds marked a three-month return of 5.51 percent, a six-month return of 10.14 percent, a one-year return of 26.1 percent, a three-year return of 11.37 percent, a five-year return of 9.74 percent, and a ten-year return of 12.15 percent as of September 30, 2021.

With a minimal risk exposure, these returns can be a decent approach for investors in a falling market scenario to start SIP in Dynamic asset allocation funds with an investment horizon of at least 3 years or more.

According to the data of ICRA Analytics Ltd, In September 2021, mutual fund contributions under the Systematic Investment Plan (SIP) surpassed Rs 10,000 for the first time, totaling Rs 10,351 crore, rising 13% from June 2021. SIP AUM climbed by 8% in September 2021 after reaching the Rs. 5 lakh crore milestone in July 2021.

SIP AUM was Rs. 5.45 lakh crore at the end of the quarter, rising roughly 13% over the previous quarter. It accounted for 15% of total industry assets, while SIP accounts increased by 12% to 4.49 crore. Hence, we would like to suggest our readers stick to their SIPs or start SIP in Dynamic Asset Allocation Funds to welcome the takeaways into their portfolio like the power of compounding, rupee cost averaging, and low initial investment.

Edelweiss Balanced Advantage Fund Direct-Growth

Edelweiss Balanced Advantage Fund Direct-Growth returns of the last 1-year are 29.10%. Since launch, it has delivered 13.65% average annual returns, according to the data of the fund house as of 18 Nov 2021. The equity side of the fund is predominantly engaged in the financial, technology, energy, fast-moving consumer goods, and automobile sectors. ICICI Bank Ltd., Reliance Industries Ltd – PPE, National Bank For Agriculture & Rural Development, Infosys Ltd., and Nifty 50 are the fund’s top five holdings.

The fund has a 0.45 percent expense ratio, which is lower than most other funds in the same category. The fund now has a 59.90 percent equity allocation and a 20.09 percent debt exposure. As of 30 September 2021, Edelweiss Balanced Advantage Fund Direct-Growth has Rs 6,331 crores in assets under management (AUM), and the fund’s NAV was 39.35 crores as of 18 Nov 2021. Value Research has given the fund a 5-star rating, and you may start investing in it with Rs 500 SIP.

Performance as on 18 Nov 2021 Scheme Scheme Benchmark CRISIL Hybrid 50+50 – Moderate Index Additional Benchmark NIFTY 50 – TRI
Period Return (CAGR) Return (CAGR) Return (CAGR)
1 Year 29.10% 23.56% 38.88%
3 Year 18.83% 16.09% 19.82%
5 Year 16.18% 13.59% 18.52%
Since Inception – Existing Plan 13.65% 9.41% 14.17%
Source: edelweissmf.com

Kotak Balanced Advantage Fund Direct Growth

Kotak Balanced Advantage Fund Direct has a one-year return rate of 19.96 percent. According to the date of the fund house as of 18.11.2021, it has generated 13.26% average annual returns since its inception. The fund has its equity allocation across the Financial, Metals, Services, Technology, Energy sectors. The fund’s top five holdings are GOI, ICICI Bank Ltd., Adani Ports and Special Economic Zone Ltd., and Infosys Ltd. The fund has a 0.45 percent expense ratio, which is lower than most other Dynamic Asset Allocation funds.

The fund now has a 78.73 percent equity allocation and a 21.27 percent debt exposure. Kotak Balanced Advantage Fund Direct-Growth had Rs 11,813.44 crores in assets under management (AUM) as of 30 September 2021, and the fund’s NAV was Rs 15.07 crores as of 18 November 2021. The fund has a 5-star rating from Value Research, and you can start SIP with Rs 500.

Tenors Since Inception Last 5 Year Last 3 Years Last 1 Year
Kotak Balanced Advantage Fund – Direct (G) 13.26% 15.02% 19.96%
Nifty 50 Hybrid Composite Debt 50:50 Index 13.49% 13.43% 15.69% 20.87%
Nifty 50 TRI 15.87% 18.54% 19.88% 38.88%
Performance as of 18.11.2021. Source: kotakmf.com


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Story first published: Saturday, November 20, 2021, 16:38 [IST]

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