LIC Mutual Fund Launches Multi Asset Allocation Fund; Key Features and Insights for Investors
The LIC Mutual Fund has launched its new scheme LIC MF Multi Asset Allocation Fund, which is an open-ended scheme that would invest in equity, debt, and gold. The Fund opened for Subscription on 24th January and will close on 7th February; sale and repurchase would continue from 18th February.
Investment Objective and Allocation Strategy
The main idea behind the scheme is to achieve long-term capital appreciation through the creation of a diversified portfolio comprising equity, debt, and gold Exchange Traded Funds (ETFs). The asset allocation is as follows:
- Equity: 65-80%
- Debt and money market instruments: 10-25%
- Gold ETFs: 10-25%
- Silver ETFs and REITs/InvITs: 0-10%
The fund follows a strategic approach, flexibly changing investments in asset classes depending on what is happening within the market environment. Hedging and arbitrage strategies will be applied to increase returns and protect the portfolio.
Minimum Amounts to be Invested
The scheme invites investors to commit with a single amount of investment of Rs.5,000 and to invest an amount of at least Rs.200 under the Systematic Investment Plan.
Investment Approach and Market Coverage
The equity portfolio will be well diversified across all market capitalizations. Both top-down and bottom-up approaches will be used to identify potential investments. This exposes investors to a wide spectrum of industries and market dynamics.
Benchmark and Fund Management
The fund is benchmarked against a composite index to measure its performance effectively:
- 65% Nifty 500 Total Returns Index (TRI)
- 25% Nifty Composite Debt Index
- 10% Price of Domestic Gold
The scheme will be managed by a team of experienced fund managers and those are Nikhil Rungta, Sumit Bhatnagar, and Pratik Harish.
Target Audience and Investment Horizon
The fund is structured for the investors who need to create a long-term wealth in a diversified multi-asset strategy. The scheme is expected to be invested in for at least three years in order to deliver optimum, risk-adjusted returns. This makes the scheme suitable for people looking to balance growth and stability in their portfolios.
Key Considerations Before Investing
Investors are advised to align the strategy of the fund with their personal financial goals and risk tolerance. Even though the fund provides diversification benefits and flexibility, the investor needs to understand the potential risks and market fluctuations.
The LIC MF Multi Asset Allocation Fund is a rare opportunity for investment in a well-balanced approach towards wealth creation by investing in equity’s growth potential, debt’s stability, and the security of gold.
