New Delhi, May 25 -- Dynamic asset allocation funds (DAAFs), also known as balanced advantage funds, invest across equity and debt in a flexible, market-responsive manner. In theory, these funds increase equity exposure when valuations are low and shift towards debt when equity valuations appear stretched.

This ability to dynamically balance risk and reward makes them particularly attractive to moderate-risk investors looking for inflation-beating, tax-efficient returns, without the need to time the market.

Historical data reveals that dynamic asset allocation funds (DAAFs) have offered strong downside protection, relatively low volatility, and consistent returns, especially appealing for moderate-risk investors.

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