Multi-Asset Funds: Diverse Risk Profiles Explained
By ThePip Desk
Discover the wide range of risk profiles in multi-asset allocation funds. Understand the riskometer and real-world data to make informed investment decisions.
You might assume all multi-asset allocation funds carry a similar risk, but new data shows this isn’t the case. These funds actually have very diverse risk profiles, and understanding them is crucial for your investment journey.
To help you navigate, the riskometer categorizes funds into six distinct levels. These range from Low, Low to Moderate, Moderate, Moderately High, High, and all the way to Very High, giving you a clear picture of potential volatility.
Real-World Risk Profiles Revealed
A recent analysis by Value Research, based on data as of July 31, 2026, looked at 34 multi-asset allocation funds. What they found highlights just how different these funds can be when it comes to risk.
For instance, only one fund out of the 34 was rated ‘Low’ risk: the Edelweiss Multi Asset Allocation Fund. This fund manages its risk by holding a significant 59.99% in debt and a substantial 48.23% in cash or cash equivalents.
On the other end, five funds were classified as ‘High’ risk. These include the 360 ONE Multi Asset Allocation Fund, Bank of India Multi Asset Allocation Fund, JM Multi Asset Allocation Fund, Sundaram Multi Asset Allocation Fund, and WhiteOak Capital Multi Asset Allocation Fund.
These ‘High’ risk funds typically have larger equity allocations in their portfolios. For example, 360 ONE holds 23.51% in equity, while WhiteOak Capital allocates 29.32% to equity, contributing to their elevated risk levels.
The majority of these funds, specifically 28 out of the 34 reviewed, fell into the ‘Very High’ risk category. A prime example is the Aditya Birla Sun Life Multi Asset Allocation Fund, which dedicates a substantial 70.97% of its portfolio to equity.
Your Portfolio Mix Matters
What this all means for you is that a fund’s actual risk level is directly tied to its specific mix of assets. The proportion it allocates to equity, debt, and other assets truly dictates its potential for volatility.
While multi-asset funds aim to diversify your investments, their unique portfolio composition makes each one distinct. Always remember to consult a SEBI-registered advisor before making any investment decisions to ensure it aligns with your personal goals.