Bandhan Balanced Advantage Fund: Changes in Investment Strategy

Bandhan Mutual Fund has announced fundamental changes to its Bandhan Balanced Advantage Fund, which will take effect from March 19, 2025. The revisions primarily impact the fund’s asset allocation, derivatives exposure, and credit instruments, altering how the fund balances risk and return.

Adjustments in Asset Allocation

One of the key changes is in the fund’s equity and debt allocation. Currently, the scheme maintains 65%-100% of its portfolio in equity and equity-related instruments. Under the revised structure, this range will be reduced to 20%-90%.

At the same time, the allocation to debt securities and money market instruments will increase from the existing 0%-35% to a broader range of 10%-80%. As per the reports, this shift will help allow greater flexibility in adjusting the fund’s debt exposure based on market conditions.

Derivatives and Credit Instruments

The fund will now permit up to 50% exposure to equity derivatives for non-hedging purposes. This means a larger portion of the portfolio can be used for strategies beyond simple risk reduction. 

Additionally, the revised framework introduces up to 10% exposure to Credit Default Swaps (CDS) within the fund’s total assets under management (AUM).

Exit Window for Investors

As per regulatory requirements, investors who do not wish to continue under the revised scheme have a 30-day exit window from February 17, 2025, to March 18, 2025. During this period, they can redeem or switch their investments without incurring any exit load.

For investors who have no objections to the modifications, no action is required. Their investments will remain in the fund, transitioning automatically to the new allocation strategy.

Effective Date 

These changes will be implemented from March 19, 2025. Investors may need to review their portfolio allocations in light of the revised structure to determine whether it aligns with their financial goals.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.