Stability and consistency from exposure to multiple asset classes: Nippon India Multi Asset Allocation Fund and Nippon India Multi Asset Omni FOF

Current market scenario

The market is going through an interesting phase. The equity market has rebounded from volatility triggered by the imposition of high tariffs on Indian exports to the United States. Lower GST rates, which will come into effect later this month can boost consumption growth especially in sectors like consumer durables, automobiles etc. Though valuations are below long term average, the PE multiple of MSCI India (USD) Index at 25.37, is higher than PE multiple of MSCI EM (USD) Index which is at 15.41 (source: MSCI, as of 31^st August 2025).

Though debt offers stability, there is limited upside since bond yields have stiffened due to fiscal concerns (e.g., lower GST collections). Gold has crossed the Rs 1 lakh per 10 gram level and continues to be on an uptrend amid global uncertainties and central bank policies. Silver has rallied by 37% on a year to date basis (source: MCX spot prices, as of 31^st August 2025) and also already record high on the commodity exchange. Where should you invest in the current market scenario?

Why multi asset allocation?

• It is difficult to predict which asset class will outperform others in a given year since winners rotate across asset classes (see the chart below) -
  
  

  

  Source: Advisorkhoj, NSE, MCX. Equity is represented by Nifty 50 TRI, Debt by Nifty 10 year Benchmark G-Sex Index, Gold and Silver by MCX spot prices, as of 31^st August 2025



• The table below shows the 1 year, 3 year, 5 year, 7 year and 10 year rolling returns of equity (represented by Nifty 50 TRI), debt (represented by Nifty 10 year Benchmark G-Sex Index) and gold in INR (represented MCX spot prices) over the last 20 years. You can see that in the short term equity may experience much larger drawdowns compared to other asset classes (see the portion of the table marked in red). However, in the long term, equity can outperform (other asset classes). Further observe that gold can generate inflation beating returns in the medium to long term.
  
  

  

  Source: Advisorkhoj, NSE, MCX. Equity is represented by Nifty 50 TRI, Debt by Nifty 10 year Benchmark G-Sex Index, Gold and Silver by MCX spot prices. Period: 1^st January 2005 to 31^st August 2025



• The chart below shows the 5 year rolling returns of equity (represented by Nifty 50 TRI), debt (represented by Nifty 10 year Benchmark G-Sex Index) and gold in INR (represented MCX spot prices) over the last 20 years. You can see that equity and gold are counter-cyclical. With a mix of equity and gold in your asset allocation, you can reduce volatility in your investment portfolio across different investment cycles. Debt provides further stability to your portfolio as well as consistent returns.
  
  

  

  Source: Advisorkhoj, NSE, MCX. Equity is represented by Nifty 50 TRI, Debt by Nifty 10 year Benchmark G-Sex Index, Gold and Silver by MCX spot prices. Period: 1^st January 2005 to 31^st August 2025



• Multi Asset Allocation funds are hybrid schemes that invest in three or more asset classes. SEBI mandates multi asset allocation funds to have minimum 10% exposure in each of the three or more asset classes. Multi asset allocation funds provide exposure to multiple asset classes in a single scheme. They also provide automatic rebalancing without tax consequences for the investor.


• Multi Asset Allocation funds are also tax efficient. Multi Asset Allocation funds with more than 65% exposure to equities enjoy equity taxation. Long term capital gains (holding period of more than 12 months) are taxed at 12.5%. Long term capital gains for multi asset allocation funds with 35 - 65% exposure to equities are also taxed at 12.5% if the holding period is more than 24 months.

Nippon India Multi Asset Allocation Fund

The fund has recently completed 5 years and is one of top performing funds in its category. The fund invests 50 - 80% of its assets in equity, 10 - 35% in debt and 10 - 30% in commodities. The fund can also invest in International ETFs. Currently the fund has 57% allocation to domestic equities, 14.27% allocation to commodity ETFs, 9.14% allocation to international ETFs and balance in debt and money market instruments (source: Nippon India MF Factsheet, as on 31^st August 2025).

Why Nippon India Multi Asset Allocation Fund?

• Consistently a top quartile performer: The graphic below shows the quarterly returns of the fund over the last 12 quarters. You can see that fund has been in the top 2 quartiles in 10 out of the last 12 quarters.
  
  

  

  Source: Advisorkhoj Research, as of 30^th June 2025



• Consistently outperformed peers across different market conditions: The chart below shows the 3 year rolling returns of the fund versus the category average rolling returns since the inception of the fund. You can see that the fund has consistently outperformed its peers for last several years
  
  

  

  Source: Advisorkhoj Research, as of 12^th September 2024

  
  

  The table below shows the 1 and 3 year rolling returns distribution of the fund versus the category average since the inception of the fund. You can see that percentage of instances of 12%+ CAGR returns of the fund was higher than that of the category - hallmark of superior performance consistency.

  

  Source: Advisorkhoj Research, as of 12^th September 2024. Fund: Nippon India Multi Asset Allocation Fund. Category: Hybrid Multi Asset Allocation funds.



• Limited downside risks for investors: The chart below shows the drawdowns of the fund versus the broad market index, Nifty 50 TRI since the inception of the scheme. You can see the fund experienced smaller drawdowns, limiting downside risks for investors.
  
  

  

  Source: Advisorkhoj Research, as of 12^th September 2024.

Nippon India Multi Asset Omni Fund of Funds

Nippon India Multi Asset Omni Fund of Funds is another multi asset product offering from Nippon India mutual fund's product portfolio. This is a fund of funds which invests in different Nippon India MF's equity funds, debt funds and Gold ETFs. The FOF can dynamically invest 0 - 100% in equity, 0 - 100% in debt, 0 - 25% in gold and 0 - 5% in money market instruments. Currently the FOF has 60.5% allocation to equity, 20.2% allocation to debt and 15.6% allocation to gold (source: Nippon India MF Factsheet, as on 31^st August 2025). The asset allocation is determined by Nippon India MF's in-house proprietary model (see the graphic below).

The chart below shows the returns of the fund versus the Hybrid Fund of Funds category average over different periods. You can see that the fund outperformed the category average across all tenures.

Source: Advisorkhoj Research, as of 12^th September 2024.

The chart below shows the calendar year returns of the fund versus the Hybrid Fund of Funds category average. You can see that the fund outperformed the category average in all years (across different market conditions).

Source: Advisorkhoj Research, as of 12^th September 2024.

The chart below shows the drawdowns of Nippon India Multi Asset Omni Fund of Fund versus the broad market index, Nifty 50 TRI. You can see that the fund was able to limit downside risks for investors.

Source: Advisorkhoj Research, as of 12^th September 2024.

Who can invest in Nippon India Multi Asset Allocation Fund and Nippon India Multi Asset Omni FOF?

• Investors seeking growth as well as stability across different market conditions and investment cycles.


• Investors seeking exposure to different asset classes.


• Investors with high-risk appetite.


• Investors with minimum 3-year investment horizons.

Investors can consult their financial advisors or mutual fund distributors if Nippon India Multi Asset Allocation Fund and / or Nippon India Multi Asset Omni FOF are suitable for their investment needs.