Factors required to be considered for Multi-Asset Allocation Fund
1. Diversification: Multi-asset allocation funds are managed by fund managers, and every fund will have its own set of parameters and composition of different asset classes. So, the investor needs to study the individual composition that fits his investing parameter.
2. Time Horizon: If an investor has a long time horizon, only then he/she should consider Multi-asset allocation funds, as they have proved to be beneficial in the long run, i.e. more than three years. If investors have short-term goals, and they are looking for a fund, Multi-asset allocation funds might not be the right choice for them.
3. Tax Implications: Investor need to ascertain the tax implication of the fund, if he/she is ignorant about the tax implication, they might not get the fruitful return out of it.
4. Risks: Investors should consider his/her risk appetite before investing. Although Multi-asset allocation funds are less prone to risks, if the investor wants to minimise the risk, he/she should approach a fund that has a lower dependence on equity.