Invest in Best Balanced Funds in India 2025
Discover the best Balanced Funds to invest in India for 2024. Learn who should invest, key benefits, risks, and find the top performing Balanced Funds in the market.
What is Balanced Mutual Funds?
Balanced Mutual funds are a type of investment fund that invest in a mix of both equity and debt instruments, giving the best of both worlds. They typically invest in 70% equity and 30% bonds.
Who Should Invest in Balanced Mutual Funds?
Balanced mutual funds are a good choice for investors who:
- Who prefer a mixture of growth as well as stability
- Who have an average risk-taking ability
- Good for beginners who want to explore mutual fund market
- Ideal for those who wish to stay invested for a time horizon of 3-5 years
Best Performing Balanced Mutual Funds
| Mutual Fund Name | Category | 1-Year Return | 3-Year Return | 5-Year Return |
|---|---|---|---|---|
| HDFC Balanced Advantage Fund | Balanced Advantage | 12.50% | 13.80% | 12.00% |
| ICICI Prudential Balanced Advantage Fund | Balanced Advantage | 11.80% | 14.20% | 13.00% |
| SBI Equity Hybrid Fund | Aggressive Hybrid | 13.00% | 15.50% | 14.00% |
| Aditya Birla Sun Life Balanced Advantage Fund | Balanced Advantage | 12.20% | 13.50% | 12.50% |
| Axis Balanced Advantage Fund | Balanced Advantage | 11.50% | 14.00% | 13.20% |
| Kotak Equity Hybrid Fund | Aggressive Hybrid | 12.80% | 14.80% | 13.50% |
| Franklin India Balanced Advantage Fund | Balanced Advantage | 13.20% | 14.50% | 13.80% |
| DSP Equity & Bond Fund | Aggressive Hybrid | 12.00% | 15.00% | 14.50% |
Factors to Consider While Investing in Balanced Mutual Funds
- Asset Allocation: Assess the distribution of funds. Higher equity allocation offer better returns
- Fund Manager’s Experience: Fund manager’s expertise in handling these type of funds often plays a vital role
- Performance History: Review the fund’s past performance, considering both returns and risk-adjusted returns.
- Expense Ratio: Compare the expense ratio of different funds to ensure you pick the one that generates optimal returns for you
- Investment Objective: Make sure the fund’s return align with your financial goals
Major Benefits of Balanced Mutual Funds
- Diversification: Since they invest in both equity and debt, your portfolio becomes diversified
- Potential for Growth: The equity component offers higher capital appreciation
- Regular Income: Debt component of this fund ensures steady returns
- Professional Management: Fund managers handle the investment decision, so you can rest assured that your money is parked in safe hands
Risks Involved in Balanced Mutual Funds
- Market Volatility: Both equity and debt markets are impacted by market movements
- Interest Rate Risk: Rising interest rates can negatively impact the debt securities
- Credit Risk: If the issuers of debt securities default, it can severely impact your returns
Frequently Asked Questions about Balanced Mutual Funds (FAQs ):
1. What is the ideal asset allocation in a balanced fund?
The asset allocation varies from fund to fund in case of balanced fund, generally, 70% equity and 30% debt allocation is preferred
2. How often should I review my balanced fund investment?
It is recommended to periodically review your balanced fund and check whether it is in alignment with your financial goals
3. Can I invest in balanced funds through SIPs?
Yes, you can invest in balanced funds through systematic investment plans (SIPs). Investing in SIPs makes you financially disciplined
4. How do I choose the right balanced fund for me?
Consider your investment goals, risk tolerance, time horizon, and compare different fund using mutual fund aggregator like Fincover to pick the best balanced fund in the market
5. Are balanced funds suitable for long-term wealth creation?
Yes, balanced funds can be a good tool for wealth creation, offering a balance between growth and income generation with moderate risk.