Finding their sea legs: BAFs, the calm in the eye of market storm

Tidal shift: Anchoring strong in choppy seas, BAFs draw Rs 2,456 crore amid equity ebb

Inflows into balanced advantage funds (BAFs) soared to a 33-month high of Rs 2,456 crore in October, driven by a sharp selloff in equity markets. This marks the highest net collection since January 2022.

 

BAFs, a hybrid mutual fund category, invest in both equity and debt assets, with allocation primarily guided by equity valuations. This strategy makes BAF less sensitive to equity market volatility while offering higher return potential compared to purely debt-based instruments.

 

Investment experts recommend BAFs for risk-averse investors, particularly during periods of market turbulence. They are also favoured for one-time investments in volatile market phases.