DSP MF launches multi-asset fund of funds with dynamic allocation

DSP Mutual Fund has launched the DSP Multi Asset Omni Fund of Funds, an open-ended fund-of-fund scheme that invests across equity, debt and commodity-oriented mutual funds and exchange-traded funds (ETFs).

The scheme seeks to simplify investing for individuals who do not actively track markets or manage asset allocation across cycles. The fund uses DSP Mutual Fund’s internal market framework, DSP Netra, which analyses market data, valuations and historical trends to assess risk and adjust allocations across asset classes.

The fund will invest in a mix of equity-oriented schemes, debt-oriented schemes, and gold and silver ETFs, with allocations that can shift based on market conditions. DSP Mutual Fund said the structure aims to balance growth and risk by diversifying across multiple asset classes instead of relying on a single source of returns.

A notable feature of the scheme allows it to invest in funds and ETFs managed by multiple asset management companies (AMCs), giving the portfolio flexibility to adjust as relative opportunities change. The fund will rebalance allocations within its structure rather than requiring investors to make frequent portfolio changes themselves.

During periods of elevated market volatility, the fund can reduce its equity exposure to as low as 25%, according to the fund house.

Indicatively, the scheme expects to allocate:

• 25–75% to equity-oriented schemes,
• 15–50% to debt-oriented schemes, and
• 10–50% to gold and silver ETFs.

However, DSP Mutual Fund clarified that final allocations will remain at the fund manager’s discretion and will adhere to the ranges specified in the Scheme Information Document (SID), which permits:

• Equity-oriented schemes: 25–80%,
• Debt-oriented schemes: 10–60%,
• Gold and silver ETFs: 10–65%, and
• Cash and cash equivalents: 0–5%.

DSP Mutual Fund said DSP Netra serves only as one input in the investment process and does not constitute investment advice, with portfolio decisions ultimately resting with the fund manager. The fund house also noted that investors in this fund of funds will bear both its recurring expenses and those of the underlying schemes in which it invests.

The New Fund Offer (NFO) will open on February 5 and close on February 19.