New NFO: Is Canara Robeco Multi Asset Allocation Fund Safe?
The recent launch of the Canara Robeco Multi Asset Fund NFO by the Canara Robeco Mutual Fund has uplifted the allure of multi-asset investing.
Yes, with equity, debt, gold and silver ETFS finely combined in a single scheme, it offers a balanced harmony with opening its subscriptions from 9th May and will soon close on 23rd May 2025.
But, "Why invest in a multi cap fund?" Well, why choose one when you can have it all?
Let's explore the Canara Robeco multi asset allocation fund review to find whether this could be the best NFO 2025 for you.
Starting with the definition to help you understand what a multi asset allocation fund is made of.
What is a Multi Asset Allocation Fund?
To simplify, Multi Asset Allocation Mutual Funds are a type of hybrid funds that invests a minimum of 10% in 3 or more asset classes. These funds will give you a combined investment opportunity to have your money spread across equity, debt and commodities like gold, silver and real estate.
Generally, a multi-asset allocation fund offers a low-risk investment option. However, returns can fall behind in rising markets.
Advantages of Investing in Multi Asset Allocation Fund
Here are the key benefits you should be aware of:
- An all-season portfolio with diversification amongst asset classes.
- A better risk and reward structure.
- Suited for long-term wealth creation with relatively less volatility.
- Comparatively modest drawdown in relation to most asset classes.
- Benefit of equity taxation with a diverse set of asset classes.
Canara Robeco Multi Asset Allocation Fund Details
The table below covers the investment details of the newly launched NFO by Canara Robeco Mutual Fund for you:
| Scheme Name | Canara Robeco Multi Asset Allocation Fund |
|---|---|
| Issue Open Date | 09-May |
| Issue Close Date | 23-May-25 |
| Category | Hybrid - Multi Asset Allocation |
| Benchmark | 65% BSE 200 TRI + 20% Nifty Short Duration Index + 10% Domestic Price of Gold + 5% Domestic Price of Silver |
| Minimum Application Amount | Rs. 1000 |
| Fund Managers | Mr. Amit Kadam & Mr. Kunal Jain |
| Plans & Options | Regular and Direct Plans with Growth and Dividend Options |
| Facilities Offered | Lumpsum / SIP / SWP |
After the new NFO alert by one of the top AMCs in India, “How this fund will strategies its framework?” is in question. Let’s cover that in the next heading.
What is Dynamic Strategy for Asset Allocation by Canara Robeco Mutual Fund?
This newly launched Canara Robeco multi asset allocation fund applies its investing strategy in three folds:
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Step 1: Equity Allocation Strategy
This framework checks several factors like TTM (trailing twelve Months), P/B (Price to book value), equity risk premium, earnings momentum, macro factors, bottom-up analysis and tries to optimise equity allocation % according to the framework. Here equity range is between 65-80% (Derivative exposure up to 50%).
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Step 2: Gold and Silver ETFs Allocation Strategy
The next approach is to check yield differentials and try to provide an optimal allocation of gold and silver ETFs. Here, the gold and silver STFs range between 10-25%.
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Step 3: Fixed Income Strategy
This New Fund Offer active duration management with a focus on high-quality credit investments. Here, the debt range is between 10-25%.
Moreover, the Canara Robeco multi-asset allocation fund NFO will invest in a high-conviction portfolio with "Leaders" with proven track records across the market cycle.
This would provide strength and compounding to portfolio as well as "Emerging Companies" with improving market share to lend alpha to your portfolio with superior returns.
To sum up, this hybrid fund is amongst the best Mutual Funds category that kills two birds with one stone.
Is it Good to Invest in a Multi Asset Fund in 2025?
Yes, investing in a Multi Asset Fund (MAAF) in 2025 can be a smart choice, especially if you want a balanced investment strategy that offers both good returns and less risk. Here’s why:
Consistent Performance: Over the past 10 years (2015-2024), Multi Asset Funds have performed steadily, even compared to other types of investments like stocks, gold, silver and fixed income. The Multi Asset Allocation Strategy (MAAS) includes a mix of 65% equity, 20% debt, 10% gold and 5% silver. This balance has allowed it to deliver solid returns even when other markets were unpredictable.
The table below shows the calendar year returns of multi cap category with individual asset classes revealing consistency:
Pro Tip: Know your returns beforehand using the SIP Calculator free of charge.
Better Risk-Adjusted Returns: Multi Asset Funds balance the risk from different investments. Stocks can give good returns, while debt helps keep things stable. Gold and silver are also useful because they often do well when stocks are struggling. This mix helps reduce risks and still deliver good returns, especially in uncertain times. Over the past few years, this strategy has shown better risk-adjusted returns than just focusing on one type of investment:
Lower Downside Risk: Multi Asset Funds are less likely to experience big losses compared to equity funds. They strike a middle ground, being safer than stocks but riskier than debt funds. This makes them a good choice if you want to avoid the wild swings of the stock market while still making decent returns:
Tax Benefits: A big plus of Multi Asset Funds is their tax treatment. They are taxed like equity funds, which means you pay a lower rate of 12.5% on long-term gains (above Rs.1.25 lakh a year). This is much better than the higher tax rates on debt funds or commodities, making them more attractive for long-term investors.
Diversification: One of the key benefits of Multi Asset Allocations Funds is that they spread your investments across different asset classes. This helps reduce the risk of relying too much on any one type of investment. If one market is down, the others might do better, balancing things out.
In short, Multi Asset Funds offer a good mix of consistent performance, lower risk, tax benefits and diversification.
Who Should Invest in Canara Robeco Multi Asset Allocation Fund NFO?
The following points give you strong suggestions on whether or not you should invest in the Canara Robeco Multi Asset Allocation Fund NFO or not:
- Investors are looking for diversification across asset classes.
- Investors with a very high-risk appetite and long-term investment horizon of 5 years and above.
- If you are trying to moderate your participation in market rallies while mitigating potential losses, this latest NFO is the best fit.
Key Takeaways to Choose Canara Robeco Multi Asset Allocation Fund NFO
Before we part ways, here is a brief summary on the Canara Robeco Multi Asset Allocation Fund review 2025:
- This latest NFO in the multi cap funds category applies an active multi-asset allocation strategy and aims to navigate all market conditions.
- A research-based framework for periodic optimisation of asset classes.
- A combination of high-conviction equity allocation, actively managed gold and silver ETF exposure and a dynamic fixed income portfolio is suitable as a likely candidate for an all-weather portfolio.
- A fund investing across equity market capitalisation and fixed income instruments across different maturities, while also having an allocation to gold and silver ETFs.
To Conclude Canara Robeco Multi Asset Allocation Fund Review
To wrap up, in this exclusive insight, some interesting details were shared that make this latest NFO a worthwhile investment.
If you want to plan strategic moves, now is the time. You can start SIP investments at Rs.1000 only, making your investments in emerging trends like gold and silver ETFs.
