HDFC Multi-Asset Fund Get the advantage of investing in 3 asset classes through 1 fund with our model-driven approach

Pune 24 August 2021: As asset class winners keep changing, asset allocation is critical for wealth creation. HDFC Multi‐Asset Fund, which invests in 3 asset classes viz. Equity, Debt, and Gold aims to meet the asset allocation needs of investors. Equity aims to provide capital appreciation, Debt aims to provide stability to the portfolio and Gold is a potential safe-haven asset class, which also provides a hedge against inflation and currency depreciation.

The Scheme adopts a model-driven approach for asset allocation. The model indicates the percentage of unhedged equity allocation by considering 4 valuation-driven factors. The unhedged Equity allocation range indicated by the model is between 40% ‐ 80%. If markets are expensive as compared to history, the model will indicate lower unhedged equity allocation and vice versa. The Scheme invests between 10% to 30% of total assets in Debt instruments & 10% to 30% of Total Assets in Gold related instruments.

In terms of sector allocation, the Scheme has an overweight position in Consumer Discretionary, Consumer Staples and Industrials; and an underweight position in Financials and Energy.HDFC MultiAsset Fund is a suitable investment avenue for investors, who are looking for a single product to provide exposure to 3 asset classes – namely equity, debt, and gold, with a long-term investment horizon.

Mr. Amit Ganatra, Senior Fund Manager of HDFC Asset Management Company Limited (HDFC AMC) said, “Global, as well as domestic growth prospects, have been buoyed by accommodative monetary and fiscal policies, pent-up demand recovery, vaccination drive, and turnaround in corporate profitability. In India – corporate earnings the cycle has turned around post-Covid-19 and a strong earnings cycle creates opportunities for investors to participate in equity as an asset class. However, there are also uncertainties around possible 3rd Covid‐19 wave, sustainability of the recovery, potentially higher inflation and higher valuations post strong market rally. In this kind of environment, Investors should consider asset allocation strategies as they not only ensure equity participation but also aim to protect the downside by exposure to other asset classes namely debt and gold.