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Dynamic Asset Allocation Funds (DDA)

Invest in the best dynamic asset allocation funds recommended by Scripbox that are algorithmically selected that best suit your needs

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Fund Category

EquityDebtHybridInternational EquitySolution Oriented

Minimum Investment

500+

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List of Dynamic Asset-allocation Mutual Funds

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Dynamic Asset Allocation Or Balanced Advantage

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Edelweiss Balanced Advantage Fund (G)

Edelweiss Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 4,308 Cr

Fund Size

12.10%

5 Year CAGR

5 Y CAGR

Motilal Oswal Dynamic Fund (G)

Motilal Oswal Dynamic Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,229 Cr

Fund Size

NA

Tata Balanced Advantage Fund (G)

Tata Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 2,873 Cr

Fund Size

13.80%

Till Date CAGR

Till Date CAGR

Invesco India Dynamic Equity Fund (G)

Invesco India Dynamic Equity Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 665 Cr

Fund Size

9.20%

5 Year CAGR

5 Y CAGR

HDFC Balanced Advantage Fund (G)

HDFC Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 41,796 Cr

Fund Size

11.70%

5 Year CAGR

5 Y CAGR

ICICI Prudential Balanced Advantage Fund (G)

ICICI Prudential Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 32,942 Cr

Fund Size

10.40%

5 Year CAGR

5 Y CAGR

Union Balanced Advantage Fund (G)

Union Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,038 Cr

Fund Size

10.80%

Till Date CAGR

Till Date CAGR

Baroda Dynamic Equity Fund (G)

Baroda Dynamic Equity Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,248 Cr

Fund Size

16.90%

Till Date CAGR

Till Date CAGR

Kotak Balanced Advantage Fund (G)

Kotak Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 9,379 Cr

Fund Size

11.50%

Till Date CAGR

Till Date CAGR

L&T Balanced Advantage Fund (G)

L&T Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,843 Cr

Fund Size

8.20%

5 Year CAGR

5 Y CAGR

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Nippon India Balanced Advantage Fund (G)

Nippon India Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 3,722 Cr

Fund Size

10.90%

5 Year CAGR

5 Y CAGR

Aditya Birla Sun Life Balanced Advantage Fund (G)

Aditya Birla Sun Life Balanced Advantage Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 3,969 Cr

Fund Size

10.30%

5 Year CAGR

5 Y CAGR

DSP Dynamic Asset Allocation Fund (G)

DSP Dynamic Asset Allocation Fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 3,778 Cr

Fund Size

8.80%

5 Year CAGR

5 Y CAGR

IDFC Balanced Advantage fund (G)

IDFC Balanced Advantage fund (G)

Dynamic Asset Allocation Or Balanced Advantage

₹ 2,108 Cr

Fund Size

9.40%

5 Year CAGR

5 Y CAGR

ICICI Prudential Balanced Advantage Fund of Inc Dist cum Cap Wdrl (PIDCW-M)

ICICI Prudential Balanced Advantage Fund of Inc Dist cum Cap Wdrl (PIDCW-M)

Dynamic Asset Allocation Or Balanced Advantage

₹ 32,942 Cr

Fund Size

9.90%

5 Year CAGR

5 Y CAGR

Aditya Birla Sun Life Balanced Advantage Fund Inc Dist cum Cap Wdrl (RIDCW-M)

Aditya Birla Sun Life Balanced Advantage Fund Inc Dist cum Cap Wdrl (RIDCW-M)

Dynamic Asset Allocation Or Balanced Advantage

₹ 3,969 Cr

Fund Size

9.50%

5 Year CAGR

5 Y CAGR

ICICI Prudential Balanced Advantage Fund Rnvstmnt of Inc Dist cum Cap Wdrl (RIDCW-M)

ICICI Prudential Balanced Advantage Fund Rnvstmnt of Inc Dist cum Cap Wdrl (RIDCW-M)

Dynamic Asset Allocation Or Balanced Advantage

₹ 32,942 Cr

Fund Size

9.90%

5 Year CAGR

5 Y CAGR

DSP Dynamic Asset Allocation Fund of Income Dist cum Cap Wdrl (RIDCW-M)

DSP Dynamic Asset Allocation Fund of Income Dist cum Cap Wdrl (RIDCW-M)

Dynamic Asset Allocation Or Balanced Advantage

₹ 3,778 Cr

Fund Size

7.10%

5 Year CAGR

5 Y CAGR

L&T Balanced Advantage Fund of Income Dis cum Cap wdrl (RIDCW-M)

L&T Balanced Advantage Fund of Income Dis cum Cap wdrl (RIDCW-M)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,843 Cr

Fund Size

7.50%

5 Year CAGR

5 Y CAGR

Motilal Oswal Dynamic Fund of Income Distribution cum cptl wdrl (RIDCW-Q)

Motilal Oswal Dynamic Fund of Income Distribution cum cptl wdrl (RIDCW-Q)

Dynamic Asset Allocation Or Balanced Advantage

₹ 1,229 Cr

Fund Size

NA

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How does Scripbox rate funds?

Proprietary 4-step system to rate mutual funds

We use a proprietary system to rate mutual funds and based on that make a recommendation or rate the fund as top ranked.

What Scripbox recommendations mean?
Scripbox algorithm recommends 2-4 funds for investment for an investment asset class such as large cap, diversified, liquid etc. When you invest for an objective, the algorithm suggests the appropriate asset class and funds.
Track Record

Track Record

We look at consistent and long historical performance for our analysis.

Fund Size

Fund Size

We look at the size of the fund with respect to other funds in the category. Larger funds are preferred.

Sub-asset Class View

Sub-asset Class View

We check if the sub-category of the fund is recommended by us.

Fund Performance

Fund Performance

Consistency of performance over various tenures is analysed for a relative performance stack.

Track Record

Track Record

We look at consistent and long historical performance for our analysis.

Fund Size

Fund Size

We look at the size of the fund with respect to other funds in the category. Larger funds are preferred.

Impact of Interest Rates

Impact of Interest Rates

We check the relative interest rate risk of the sub-category of the fund. Lower the better.

Credit Attractiveness

Credit Attractiveness

We check the credit quality of the underlying instruments present in the fund. Higher the better.

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Debt Funds

How to invest in Dynamic Asset Allocation Or Balanced Advantage Funds?

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Fund Selection

You'll never have to worry about what funds to choose. We'll suggest what's best for you.

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Continuous monitoring & alerts

We will track our recommendations and suggest changes & fund exists whenever required.

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We review your investments and make course corrections every year to make the best out of your investments

What are Dynamic Asset Allocation Funds?

Dynamic Asset Allocation funds or Balanced Advantage Funds are hybrid funds that invest in a mix of asset classes. They usually invest in Equity, Debt, Equity Derivatives, Real Estate, etc. and are managed dynamically. Based on the investment objective of the fund, the fund manager determines the asset allocation for the fund. He actively monitors the investments and rebalances the portfolio based on the market conditions to keep it in line with the investment objective. Generally, when the valuations are low, the fund increases its equity exposure, and when valuations are high, lowers the equity exposure. The fund rebalancing is backed by proper research and quantitative analysis and is not subject to emotional bias.

DAA funds invest in a way that minimizes risk based on market trends, and are targeted  at first time and low-risk appetite investors. DAA doesn’t involve having a target investment mix of assets. Therefore, the fund manager has a high degree of flexibility while rebalancing. The success of DAA funds depends not just on  market conditions but also on the manager’s decision-making ability. 

Who should invest

As Dynamic Asset Allocation funds invest in more than one asset class, they are designed for risk-averse investors. Long term investors who understand the risk-return trade off   and want a way to balance the Equity-Debt exposure in their portfolio might consider these investment options. As the fund manager himself will take care of the asset allocation during volatility, the investor need not worry about their investment. 

Though equity investments are risky, they beat inflation in the long term, and debt investments earn guaranteed returns. DAA funds fill the gap and offer investors a solution that is designed to balance risk with good growth over the long term. 

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Importance of Dynamic Asset Allocation  

  • Diversification: ‘Don’t put all your eggs in one basket’.  As an investor never invest all your money in just one asset. Diversification is the key to better returns. DAA funds do just that. For investors who would like to diversify investments can invest in these. These are best suited for long-term and low-risk appetite investors as they have enough exposure to equity and debt. 
  • Better Returns: As DAA funds invest across different asset classes, market fluctuations don’t have a drastic impact on their returns. Hence these funds are considered to offer better returns over more risky investments. 
  • Volatility: An up or a downtrend of any asset class cannot sustain for  long. A downtrend follows every uptrend and vice versa. DAA funds are not too volatile as they invest in multiple asset classes. Though DAA funds don’t offer returns as high as that of a pure equity fund, their fall isn’t as drastic as an equity fund, because of their genuine diversification which minimizes the impact of volatility.

Challenges of Dynamic Asset Allocation Mutual Funds

Tax Structure:

Each asset class has its tax structure. Equity taxation varies from that of debt. Within debt, Bonds, FDs, and debt MFs are taxed differently. Therefore, balancing taxation becomes a challenge while building a portfolio.

Cost:

Frequent rebalancing can be a costly affair with high transaction costs. Acquisition cost of a few assets isn’t cheap either. Frequent buying and selling will have an impact on overall returns. 

Active Management:

Dynamic Asset Allocation demands active management of the portfolio and rebalancing. It requires the fund manager to do extensive research and strategize his buying and selling. Therefore, the fund manager needs to dedicate a considerable amount of time to the fund‘s active management. 

Dynamic asset allocation fund taxation:

Dynamic Asset Allocation Funds are managed like equity mutual funds. The equity plus arbitrage is maintained around 65% or more, to be treated as an equity mutual fund for tax purposes. In instances where the assets under equity fall below 65%, the fund is managed like a debt mutual fund. Ergo, the tax for such funds depends on the allocation to equity assets in the fund.

For an equity fund, the STCG of 15% is levied in the short-term. Short-term is if the investments are redeemed before completion of one year from the date of investment. In the long term, the LTCG of 10% is applicable for gains above 1,00,000 INR. For a debt fund, the STCG tax is similar to the tax slab the investor falls in. LTCG is taxed at 20% (with indexation) if the investments are redeemed after three years from the date of investment.

Expenses

The transaction costs in dynamic asset allocation funds are high when compared to a constant portfolio fund. With continuous rebalancing of the portfolio, the costs tend to be on the higher side. The expense ratio is calculated as a percentage of the NAV. Hence the gains tend to be lower in this case. 

The expense ratio charged by the fund houses is less when compared to a DIY (Do Your Own) portfolio using the dynamic asset allocation strategy. The costs involved in continuous rebalancing plus the taxation will leave nothing for the investor. Hence, it is always optimal to choose a mutual fund over a DIY portfolio in this case.

Dynamic Asset Allocation Funds in India

Indian markets can be quite volatile. Any national and international news causes considerable volatility in the market. Be it political unrest in the country or Brexit or USA China tariff wars; everything affects the Indian market. 

Dynamic asset allocation strategy best suits markets that are highly volatile. It is practically impossible to time a volatile market. Investing in pure equity or debt can be challenging. This strategy strikes a balance between risk and returns with lower drawdown than a pure equity investment and higher return than a pure debt investment.

Explore Funds by Category

Index FundsSmall Cap Funds
Equity FundsDynamic Asset Allocation Funds
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Large Cap FundsRetirement Funds
Debt FundsDiversified Funds
Tax Saving FundsHybrid Funds
Mid Cap FundsArbitrage Funds
Corporate Bond FundsMoney Market Funds
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Ultra Short FundsBanking and PSU Funds
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Long Duration FundsMedium Term Funds
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