The bellwether Indian stock indices saw their worst fall in 18 months on Wednesday, with the BSE Sensex plunging over 1,600 points and the Nifty 50 dropping by 460 points. This happened at a time when the markets have been hovering near their lifetime highs. Investors in equity mutual funds are worried as a sudden selloff could erode the value of their portfolios. Some mutual fund categories and investment strategies can help mitigate the impact of volatility.
Balanced advantage funds (BAFs)
These schemes, also known as dynamic asset allocation funds, invest in a mix of bonds and stocks depending on