Fund of Fortnight

This is our mutual fund recommendation. Every fortnight, we recommend one open-ended equity diversified fund that has the best potential of returns for the next one year considering its constituents remain the same. [EasyDNNnews:PaidContentStart]
 

Reason for recommendation 

Multi-asset allocation mutual funds can be a reliable choice during periods of equity market corrections due to their diversified investment approach across multiple asset classes. By maintaining a minimum of 10 per cent allocation in at least three asset types—typically a mix of equity, debt and assets like gold or real estate, these funds manage risk more effectively. Hence our choice of mutual fund for this issue is Quant Multi Asset Fund. 

The fund truly stands out in the long-term horizon. Over one year, it posted a remarkable return of 46.07 per cent, vastly outperforming the category average of 29.02 per cent. Similarly, over a three-year period, the fund delivered a return of 22.17 per cent, compared to the category average of 15.1 per cent. Over a five-year period, the fund has generated a stellar return of 28.61 per cent, far exceeding the category average of 19 per cent. 

In terms of sectoral allocation, the fund is well-diversified, focusing on high-growth sectors that provide resilience and growth potential. The energy sector holds the largest share of the portfolio at 17 per cent while consumer staples account for 9.17 per cent. These are defensive sectors which tend to perform well during periods of uncertainty. The fund has strategically invested in industry leaders across various sectors. ITC Ltd. holds the highest allocation at 9.17 per cent, demonstrating the fund’s confidence in this consumer staples giant. 

Reliance Industries Ltd. follows closely at 8.93 per cent, positioning the fund to benefit from the company’s diverse operations, particularly in the energy and telecom sectors. The fund boasts an alpha of 11.87, significantly higher than the category average of 2.7. Given its robust performance, this fund is an ideal choice for investors seeking long-term wealth creation through a diversified portfolio in both the growth and defensive sectors. 

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