HDFC Balanced Advantage Fund: How Rs 10,000 mutual fund SIP grew to a massive Rs 14 crore

HDFC Balanced Advantage Fund, which is set to complete of 30 years of existence on February 1, has made solid money for its investors in the long run. Consider this: An initial investment of Rs 1 lakh in the open-ended balanced advantage fund would have grown to Rs 1.58 crore in the past three decades, indicating a compound annual growth rate (CAGR) of 18%. For SIP investors, this means an investment of Rs 10,000 per month has turned to over Rs 14 crore at present.

According to HDFC Mutual Fund, HDFC Balanced Advantage Fund employs a dynamic investment strategy, actively managing allocations between equity and debt instruments. The approach to equity investments is guided by a broad framework that primarily considers market valuations, including the trailing twelve-month price-to-earnings ratio of Nifty 50 and the earnings yield/G-Sec yield ratio. The fixed income strategy includes diversification across credits, asset types, and tenures, with duration adjusted based on interest rate views. The credit risk is mitigated by prioritising safety, liquidity and returns (SLR).  

According to Value Research, the net asset value (NAV) of the fund was at Rs 441.32 on January 30, 2024.

Navneet Munot, MD and CEO, HDFC AMC, said “HDFC Balanced Advantage Fund’s incredible journey of three decades reflects our time-tested investment philosophy and robust processes.”

Gopal Agrawal, Senior Fund Manager, HDFC AMC, said, “HDFC Balanced Advantage Fund has successfully navigated through multiple market cycles with its disciplined approach to investing and focus on long term. A strong investment framework enables us to effectively manage its dynamic asset allocation on behalf of our investors. The fund is well-diversified and aims to continue capitalising on India’s growth opportunity.”

As of November 2023, the fund had an asset allocation of 66% in equity and 34% in debt securities and money market instruments.