New Delhi, March 7 -- Vikrant Sharma, New Delhi

Multi-asset allocation funds are hybrid mutual funds that invest in at least three different asset classes, with a minimum allocation of 10% in each asset class. Typically multi-asset allocation funds invest in equity, debt, and one additional asset class such as gold, real estate, or commodities. These funds aim to provide investors with a diversified portfolio that can balance risk and return more effectively than investing in a single asset class.

Before we deep dive into multi-asset allocation funds it is important to understand what hybrid mutual funds category is, of which multi-asset allocation fund is a sub-category.

Hybrid mutual funds, often referred to as balanced funds, are mu...