HDFC Balanced Advantage Fund Direct Growth

HDFC Balanced Advantage Fund Direct Growth is an open-ended hybrid mutual fund scheme aiming to provide long-term capital appreciation and income. The fund managers strategically allocate investments between equities and debt instruments based on market conditions to optimise returns while managing risk. As of June 2024, HDFC Balanced Advantage Fund Direct Growth holds the largest AUM, i.e., ₹86,471.32 Cr.

Founded on February 1, 1994, this fund is known for generating consistent returns in its category, achieving the highest return among Dynamic Asset Allocation funds over the last 5 years. 

The fund's equity investments are diversified across market cap segments, with 40.3% in large-cap stocks, 4.2% in mid-cap stocks, and 9.3% in small-cap stocks. This diversified approach helps in balancing growth potential and risk. 

Fund Managers

The HDFC Balanced Advantage Fund Direct Growth is managed by a team of five experienced fund managers. Gopal Agrawal and Srinivasan Ramamurthy have been overseeing the equity assets since July 29, 2022. Anil Bamboli has been in charge of the debt assets since July 29, 2022. Arun Agarwal and Nirman Morakhia manage the arbitrage assets, with Agarwal starting on October 6, 2022, and Morakhia joining on February 15, 2023.

Holdings

The HDFC Balanced Advantage Fund Direct Growth's holdings are diversified across various sectors. The equity portion primarily includes investments in the Financial, Energy, Automobile, Infrastructure, and Technology sectors. The fund strategically allocates its investments to optimise returns while managing risk and maintaining a balanced portfolio to adapt to market conditions.

Suitability

This fund is suitable for investors with a 'Very High' risk profile and capital appreciation with a balanced approach between equity and debt. The investment horizon should ideally be medium to long term (3+ years) to ride out market fluctuations.

Investment Objective

The Scheme seeks to provide long-term capital appreciation and income from a dynamic mix of equity and debt investments.

Taxation

These funds invest between 65% and 80% in equities and the remainder in debt instruments. So, when the fund is equity-oriented, i.e., the asset allocation is more than 65% in equity instruments,

• For short-term investment (less than a year), capital gains will be taxed at 15%

• For long-term investment (more than 1 year), capital gains will be taxed at 10% without indexation benefit;

• Gains up to Rs 1 lakh are exempt from taxation (more than 12 months).