JP Morgan Launches Balanced Advantage fund (NFO)-Should you invest?

JP Morgan Balanced advantage fund-NFOJP Morgan Launches Balanced Advantage fund (NFO)-Should you invest?

Yesterday JP Morgan Launched balanced advantage fund, which is open ended mutual fund scheme. JP Morgan Balanced Advantage Fund has an investment objective of generating long term capital appreciation and current income from a portfolio of equity and fixed income securities. NFO news is appearing now in all leading news papers and advertisements on financial websites which is catching investor attention. What are the features of JP Morgan Balanced Advantage Fund? Should we invest in this balanced mutual fund scheme?

Also Read: Which are the top 5 mid-cap / small-cap mutual fund schemes which are performing consistently?

Features of JP Morgan Balanced Advantage Fund NFO

  • NFO Opens: 18-March-2015
  • NFO closes: 1-April-2015
  • Reopens for subscription from 10-April-2015
  • NAV of the fund: Rs 10 per unit
  • Risk Color code of the scheme: (BROWN) – Investors understand that their principal will be at high risk.
  • Benchmark: Crisil Balanced fund index
  • Minimum application : Rs 5,000 and in multiples of Rs 1 thereof.
  • Expense Ratio: Up to 2.5% and an additional expense of 0.5% totaling to 3%
  • The scheme offers growth, bonus and dividend (payout & reinvestment) options under both regular plan and direct plan.
  • Complete NFO prospectus can be read here.

​What is the initial application amount?

JP Morgan Bal advantage fund-Application amt

What is the entry load and exit load for this scheme?

The entry load is Nil, while exit load of 1% for each redemption within and including 18 months from the date of allotment in respect of Purchases made other than through Systematic Investment Plan (SIP); and if redeemed within and including 18 months from the date of allotment of units of each instalment of SIP purchase. Beyond 18 months from the date of allotment, exit load is Nil.

Where does this JP Morgan Balanced Advantage fund mutual fund scheme invest?

The scheme shall invest 30-60% in equity and equity related instruments, 5-10% in net equity arbitrage exposure with medium to high risk profile and 30-60% in debt securities and money market instruments with low to medium risk profile.

JP Morgan Bal advantage fund-Asset allocation

Also Read: Are you investing in these best mutual funds of 2015?

Should you invest in JP Morgan Balanced Advantaged Fund?

Personally, I feel we should invest in existing proven mutual fund schemes rather investing in NFO’s. Markets are at peak. Investing in NFO’s and testing its performance at this level may not be a good idea. If you are a high risk investor and want to still test it, you can invest in such schemes. Alteranatively you can invest in other consistent performing balanced mutual fund schemes like HDFC Prudence, ICICI Balanced Mutual fund, Tata Balanced Fund schemes, etc. which has given more than 16% annualized returns in the last 5 years and 50% returns in last 1 year.

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JP Morgan Launches Balanced Advantage fund (NFO)

Suresh KP

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