Launched in 1995, UTI Balanced Fund offers balanced category. The fund aims regular income together with capital appreciation by following a disciplined and balanced approach to asset allocation.
According to a release, the fund is managed with an equity tilt and the entire alpha is generated out of equity portion. The debt is managed on a conservative basis and is invested mostly in long term corporate bonds.
The fund manager avoids taking allocation calls between equity and debt unless there are very strong signals of equity underperforming by a wide margin. Historically, the equity is closer to the maximum level of 75% while in debt segment the fund focuses on corporate bonds of maturity of two to three year.
On a tactical basis, the fund takes exposure in G-Sec to the extent of 20% to 30% of the debt portfolio in case of fund house’s view is bullish on G-secs. Currently, the fund has around 60% weight in large caps and balance in mid and small caps and would aim to maintain this weight.
The fund would strive to derive alpha from the investments in mid and small caps. In terms of mid caps, the major sectors where the fund is invested are IT, Utilities & Chemicals.
The fund is suitable for those who are looking to diversify their portfolio and build long term wealth. Investors looking for equity returns with a limited downside risk will also find this appropriate.