Here's why you should invest in balanced advantage funds in times of uncertainty

With fluctuations in market trends and unpredictable outcomes, finding the right avenue becomes crucial for investors . This is where balanced advantage funds come into play, offering a stable and calculated approach to investment.

Niranjan Avasthi, Senior Vice President at Edelweiss Mutual Fund, stressed on the significance of balanced advantage funds, especially in times of uncertainty.

Avasthi emphasised how these funds provide investors with a dependable option by minimising volatility and ensuring a smoother investment journey.

"When the markets are uncertain in their direction, whether they go up or down, balanced advantage funds adapt to market conditions. They are an excellent choice for investors seeking to mitigate risk while actively participating in the equity markets," Avasthi told CNBC-TV18.

Sahil Kapoor, Senior Executive Vice President at 360 ONE Wealth, echoed Avasthi's sentiments.

He emphasised on the suitability of balanced advantage funds in choppy markets and periods of elevated valuation levels.

Kapoor highlighted two advantages of these funds.

Firstly, he mentioned their disciplined approach to investing, rebalancing equity and debt allocations based on metrics such as valuation, momentum, and sentiment.

"This disciplined strategy ensures a well-managed investment portfolio," he said.

Secondly, Kapoor pointed out the tax benefits associated with balanced advantage funds, noting that all portfolio churn within these funds is tax-free for investors.

This adds another layer of appeal to these funds, making them a tax-efficient choice for savvy investors.