3 weeks ago
Investors Turn to Multi-Asset Funds for Gold, Silver Exposure
Think of a multi-asset fund like a lunchbox that must always carry at least three different food groups.
Inside, it holds stocks, bonds, and precious metals like gold and silver.
Last year, gold did really well, so these lunchbox funds made good returns of about 15 to 17 out of every 100 rupees or dollars.
Because of that, lots of people started putting money into them — much more than into other similar funds.
One expert says people should be careful, though.
Gold and silver don't always go up; they go in up-and-down cycles and can make your money wobble.
Recently, gold prices have stayed steady, so these funds have slowed down and some even lost money over six months.
The expert says choosing investments because they recently did well can be a mistake.
Instead, people should pick based on long-term goals and how much risk they can handle.
Multi-Asset Allocation Funds (MAAFs) drew nearly ₹38,027 crore in inflows from January to June 2026, versus around ₹5,586 crore for Balanced Advantage Funds.
MAAFs delivered category-average returns of roughly 15-17% in 2025, lifted by gold's strong run amid central-bank buying and geopolitical tensions.
Chacko cautioned that commodities like gold and silver are cyclical, add volatility, and often underperform equities over the long term.
In July 2026, Canara Robeco Multi Asset Fund topped monthly returns at 2.71%, while Kotak led one-year returns with 21.59%.
Several funds posted negative six-month returns — Quant -2.99%, Bajaj Finserv -1.90% and Sundaram -2.87% — highlighting uneven recent performance.
- Who
- Investors in Indian mutual funds and managers of Multi-Asset Allocation Funds (MAAFs), with commentary from quoted expert Chacko.
- What
- Investors are pouring money into MAAFs, partly for gold and silver exposure, after the category returned 15-17% in 2025, even as experts warn about commodity cyclicality.
- Where
- India's mutual fund industry, as indicated by Indian fund houses and rupee-denominated inflows.
- When
- Covering 2025 performance, January-June 2026 inflows, and the July 2026 fund performance snapshot.
- Why
- Gold's strong 2025 performance, driven by central-bank buying, geopolitical tensions and safe-haven demand, boosted MAAF returns and attracted inflows, which the expert attributes partly to recency bias.
Investors favouring recent MAAF performance
Experts cautioning on commodity cycles
Gold and commodity exposure
Investors favouring recent MAAF performance
Gold's strong 2025 run — powered by central-bank buying, geopolitical tensions and safe-haven demand — made MAAFs attractive, with 15-17% average returns drawing investor interest.
Experts cautioning on commodity cycles
Chacko warns commodities are cyclical, add higher volatility, and often underperform equities long-term; recent gold consolidation has already tempered MAAF returns.
Hybrid funds vs. separate funds
Investors favouring recent MAAF performance
MAAFs offer automatic diversification across at least three asset classes, attracting ₹38,027 crore in inflows during January-June 2026.
Experts cautioning on commodity cycles
Hybrid funds can duplicate investors' existing equity, debt and gold holdings and take away control over asset allocation, Chacko said.
Using recent returns to decide
Investors favouring recent MAAF performance
Strong recent performance (15-17% in 2025) drove nearly ₹24,000 crore into MAAFs in early 2026, signaling robust demand.
Experts cautioning on commodity cycles
The interest reflects recency bias; several funds posted negative six-month returns, so investors should judge funds across market cycles and against long-term financial goals.
Key facts
- MAAF inflows (Jan-Jun 2026)
- ₹38,027 crore
- BAF inflows (Jan-Jun 2026)
- ₹5,586 crore
- MAAF average returns (2025)
- 15-17%
- MAAF inflows (Jan-Mar 2026)
- ~₹24,000 crore
- Minimum asset-class rule
- At least 3 asset classes, minimum 10% each
- Best 1-year return
- Kotak Multi Asset, 21.59%
- Best 3-year return
- Quant Multi Asset, 22.50%
- Best since-inception CAGR
- DSP Multi Asset, 20.07%
Quotes
Chacko
Financial analyst discussing fund strategy
“One should understand commodities like gold & silver tend to undergo cyclical performance and creates higher volatility in the portfolio and most often underperforms the equity asset class in long‑term.”
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