This Fund Can Work Both Like a Hare and Tortoise

We have all heard the story of the hare and the tortoise.

The hare challenges the tortoise for a race, mocking it for its speed. While the race is underway, the hare sprints through most of the route, napping just before the end, as it believes that the tortoise is unlikely to catch up.

The tortoise continues to walk slowly and steadily, and manages to reach the finish line while the hare remains fast asleep.

This story is used to impart the wisdom that hard work and consistency can often outperform quick and careless actions.

In the world of investing, it is generally believed that staying invested for longer, especially in equities, can help.

So it could be better being a tortoise in the world of investing.

But what if you could enjoy the benefits of both the hare and the tortoise?

Sounds strange? Well, not quite.

Let’s acquaint ourselves with the Kotak Balanced Advantage Fund.

This is a hybrid product, which invests in both equity and debt, and changes its allocation between the asset classes based on market conditions.

Kotak’s Balanced Advantage Fund can invest 65-100% in equity and equity-related securities, and upto 45% in equity derivatives. It can invest upto 35% in debt securities and money market instruments, and upto 10% in units of REITs and INVITs.*

The fund has had an average allocation of 42% in equities^. Historically, the fund has invested a maximum of 80% in equities since its inception**.

Data shows that the fund has an upside participation ratio of 56% and a downside participation ratio of 36%^^.

So this fund has behaved like a hare in times of upside, and like a tortoise in times of a fall.

You can consider this hare-tortoise combination in a fund, click here to know more.

 

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* Source: Scheme Information Document (“SID”) of, Kotak Balanced Advantage Fund. Refer SID for detailed asset allocation.

^ Source: ICRA, average allocation is since inception (3rd August, 2018) up to July 29, 2022                  

**Source: KMAMC Internal Research, data as on July 31, 2022

^**Net Equity Allocation (equity and equity related securities net of hedged positions using derivatives)

Upside & Downside participation ratio for fund is calculated by taking the fund's monthly return during months when the benchmark had a positive/negative return respectively and dividing it by the benchmark return during that same month. Subsequently the ratios are calculated using the Geometric average for both the fund and index returns during the up and down months, since inception i.e. 03thAug 2018 to 29th Jul 22. Past performance may or may not be sustained in future.

&: Additional Benchmark

Source: Morning Star Direct, ICRA MFI

For detailed portfolio and related disclosures for the scheme please refer our website https://www.kotakmf.com/Information/forms-and-downloads. The portfolio and its composition is subject to change and the same position may or may not be sustained in future. The fund manager may make the changes, as per different market conditions and in the best interest of the investors. To view the latest complete performance details of the Scheme kindly refer to the factsheet on our website https://www.kotakmf.com/Information/forms-and-downloads.

Kotak Balanced Advantage Fund is managed by Mr. Harish Krishnan, Mr. Abhishek Bisen, Mr. Arjun Khanna, and Mr. Hitesh Shah. Click here to view the funds managed by them.