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Balanced Mutual Funds


 

wealthymatters.com

Balanced funds are mutual funds that invest in both equities and debt instruments.They normally keep their equity component in the range of 60%-75% and the  rest in debt products or cash.Some balanced mutual funds are considered to be more aggressive in that they have a larger equity component.For example, HDFC Prudence keeps its equity allocation around 75% in most of the cases and rest 25% in debt or cash. However,others like Reliance Regular Savings Balanced are considered less aggressive and have a lower equity component around 60-65% .

From the taxman’s point of view, any mutual fund which has equity component more than 65% is considered as an “Equity Fund” and so long term capital gains from sale of balanced mutual fund units too are exempted from tax after one year just like in the case of pure equity mutual funds . Read more of this post

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