Mutual Funds Investment: When new investors come to the market, they often want to earn more money in the shortest possible time. He wants to become a millionaire in a couple of years. And in this hurry, they also lose their capital or implicate money in some place where there is very little return. The right place in the market and long term investment gives better returns.
There is an atmosphere of uncertainty in the market at this time. Markets are running at record highs. Many such market experts say that at this time investing in Multi Asset Fund is more favorable. If an investor would have invested one lakh rupees in ICICI Prudential Multi Asset on 31 October 2002 i.e. at the time of inception of this fund, then that amount has become 41.46 lakh rupees today. This fund has given returns of 21.65% compounded annually (CAGR).
Multi Asset Fund
Multi Asset Fund basically invests your money in multiple sectors and stocks. This fund invests money in Equity as well as Gold Investment and Exchange Traded Fund or ETF. Renowned fund manager Sankaran Naren believes that a multi asset strategy can be capable of delivering better returns in the current environment. During March 2020 when the market was going all the way down, S.K. Naren had only said that the market can go down a lot. It is becoming a good investment opportunity for the investors. This also happened right and the market broke from 40 thousand and reached close to 26 thousand.
Why asset allocation is important
ICICI Prudential’s Chief Investment Officer (CIO) S. Naren says that at a time when the market is now at historic highs, investors should think about their portfolio asset allocation. He believes that instead of focusing more on equities, investors should look at other asset classes. It can have debt, gold and global funds as well as real estate.
S. Naren says that multi assets allow investors to earn better returns in a volatile environment. It also has less risk. ICICI Prudential Multi Asset is one of the largest multi asset funds in the mutual fund industry with an Asset Under Management (AUM) of Rs 12,405 crore. It has more than 65% AUM of this category.
Invest in Equity as well as Gold and ETFs
This scheme is managed by S. Naren does it. This scheme invests 10-80% in equity. 10-35% is invested in gold and ETFs etc. 0-10% is invested in real estate trusts or InvITs. In this regard, Nimesh Shah, MD & CEO, ICICI Prudential says that this scheme works very well in building wealth.
19 years ago one lakh today 41.46 lakh
If an investor would have invested one lakh rupees at the time of establishment of this fund on 31 October 2002, then that amount has become 41.46 lakh rupees today. This fund has given returns of 21.65% compounded annually (CAGR). In the same time, Nifty 50 has given returns at the rate of 18.21% CAGR. That is, the investment of one lakh was only 24.05 lakhs. Asset allocation scheme is good for long term investment. Systematic Investment Plan (SIP) is a better investment method. If someone would have done a monthly SIP of 10 thousand rupees in this scheme, then this amount has become Rs 1.60 crore today. Whereas his investment was only Rs 22.9 lakh. That is, there was a CAGR return of 17.78% for the month.
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