Risk-mitigating focus makes it attractive amid volatility

At present, projections and estimates of interest rates and earnings of companies are not comforting for analysts and market experts. Uncertainty is far more evident today than one year ago.

To deal with such a situation it makes sense to be invested with a balanced fund which has a reasonably good exposure to debt and equity. One such recommendation is Tata Balanced Fund, managed by Atul Bhole and Akhil Mittal.

Three features make the fund a relevant investment in the present volatile times. One, it is the fund’s stock selection. Consistently the fund has stuck to risk-mitigating strategies both in equity and debt. As far as equities are concerned, the scheme’s fund manager has stuck to quality companies. Two, on the debt side, the fund manager has refrained from investing in securities which have less than AA rating.

Among the top holdings of its debt portfolio are long-term government securities.

This means that the fund manager does not intend to take credit risk. Lastly, it is the performance of the scheme which has been commendable in the past three to five years.

It has been an outperformer in the balanced fund category by giving 18% and 15% returns in the past three and five years. On the other hand, its peers have given returns of 13-17% in the same period.