Staggered bets in multi-asset MFs look apt amid bullish sentiment

ET Intelligence Group: With the benchmark Sensex touching a record 80K mark, distributors recommend caution to investors while toning down return expectations from the market. They advise incremental investments in multi-asset schemes. These schemes invest across various asset classes including equity, debt, and commodities thereby reducing dependence on a single asset class for return generation.

"One must not be overly concerned about valuations right now since India is on a high growth trajectory.

At present, most asset classes such as equity, debt and commodities look attractive from a long-term perspective," said Harshavardhan Roongta, CFP, Roongta Securities, adding that investors can consider multi-asset schemes.

Over the past 12 months, multi-asset schemes have given 26.6% returns on average according to mutual funds research firm Value Research. Among multi-asset schemes, investors can consider investing in ICICI Pru Multi Asset and Kotak Multi Asset Allocator given their long record of outperformance in the category.

Rupesh Bhansali, head-mutual funds, GEPL Capital, brought to notice that in past one year gold prices rose by 20%. "This was unexpected for the markets. Similarly, at present, it is difficult to gauge which asset class will appreciate further," Bhansali said. In such a situation, he believes investing in multi-asset schemes makes sense.

Some advisors are optimistic about gold from a multi-year perspective. "We are more bullish on gold now. Our investment horizon is eight to 10 years. We advise our clients to invest in sovereign gold bonds and earn reasonably good returns and tax benefits upon maturity," Suresh Sadagopan, founder, Ladder7 Financial Advisories said.