Multi-asset allocation funds have emerged as top performers in 2025, driven by sharp rallies in gold and silver.
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The gold and silver plating of multi-asset funds has been a clear winner, delivering outstanding performance in 2025. Silver prices more than doubled last year, while the yellow metal returned 60 per cent.
These funds invest across asset classes, including gold, silver, equities, and debt, and have been generating alpha returns over the last few years.
Top performers
The Nippon India Multi Asset Allocation Fund has been the top performer, delivering returns of 23 per cent over the last three years and 22 per cent in 2025. The UTI Multi Asset Allocation Fund has delivered returns of 13 per cent and 22 per cent over the last three and one year, respectively, while the HDFC Multi Asset Allocation Fund has delivered returns of 15 per cent and 17 per cent over the last three and one year, respectively.
AUM surge
In the last year, the assets under management of multi-asset allocation funds increased by 59 per cent to Rs 163,731 lakh crore, up from Rs 103,320 lakh crore in December 2024, as per AMFI data.
Besides giving investors exposure to gold and silver, Multi Asset Allocation Funds offer a host of other benefits, with diversification being the key. These funds spread the investment across different asset types, which cushions against poor performance in any one asset class, thus reducing overall portfolio risk.
Risk balance
Multi-asset allocation funds balance higher-risk assets, such as equity, with safer assets, such as debt, thereby lowering volatility and protecting capital during downturns.
However, both metals are prone to wild swings, more so silver, which has witnessed extreme volatility in the last few weeks, falling by over 10 per cent in a single day.
Expert view
Sandeep Parwal, Founder – SPA Group, said multi-asset mutual funds have gained significant traction in 2025, driven by higher returns in this category, primarily due to strategic allocations to gold and silver.
“The world is in crisis and perhaps going through a process of global reserve currency reset and this will trigger extreme market volatility. The trend may continue for some time, prompting investors to focus on capital protection, inflation-beating returns, value-driven asset rotation and tax efficiency,” he said.
In current conditions, multi-asset strategies offer a compelling solution, as they effectively address these evolving investor priorities within a single product category, he added.
Published on January 9, 2026