All about Dynamic Equity Funds

Posted by Nivesh.com | Mutual Funds For All on July 17th, 2018

All about Dynamic Equity Funds

Dynamic Equity Funds are the ones that allocate less to equities when market valuations seem expensive and increase allocation to equities when market valuations look cheap.

How do Dynamic Equity Funds work?

These funds have a mix of debt and equity in their portfolio. The equity component in such funds varies from 30% to 70-80%, and at times even go up to 100%.

Who should invest in Dynamic Equity Funds?

Ideally, first-time investors with low risk appetite should invest in these funds.

Why should one invest in Dynamic Equity Funds?

  • With these funds, one does not need to worry to time the markets as these have built-in profit booking at higher equity valuation.
  • These funds offer high risk-adjusted returns as they limit the downside in volatile markets.
  • When the markets fall, dynamic funds see a lower erosion in their net asset value (NAV) as compared to a pure equity fund.

Taxation and Dynamic Equity Funds?

These funds are taxed as equity funds for investors.
 
When the fund lowers its exposure to equities, it ensures that equity plus arbitrage component of the scheme is at least 65% of the corpus, which helps it qualify for equity taxation.
 
 
Dynamic equity funds tend to hold higher cash during the time of rising markets, they may
underperform during strong market conditions but they are capable of automatically rebalancing
portfolios.

Nivesh.com | Mutual Funds For All

About the Author

Nivesh.com | Mutual Funds For All
Joined: July 17th, 2018
Articles Posted: 14

BitKong: Fairest and most thrilling Bitcoin casino on the market
Win serious funds fast when you stack the BitKong bonus combo, cash in on the referral program, or hit the massive jackpot then walk away with your life changed.
Download The App - Celsius
Buy, Earn & Borrow on the Blockchain. Celsius Network lets you buy coins, earn interest on your crypto and borrow against it.
Delicious meals - easybbqrecipies.simplesite.com
Use your kettle BBQ to cook delicious meals"Barbeque on Weber" recipes filmed in South Africa as demonstrated by Johan Botha, culinary expert.
The Syndicate - Pre match bets - ACCAs - Doubles and trebles
Online pre match betting service, singles, doubles and accas, football betting at its best from one of the UKs top tipsters. Join in, get on the bets on Facebook.
The BBQ Book Competition BBQ Secrets - Championship Barbecue Recipes
The Barbecue Recipes found in Competition BBQ Secrets are real. From a 8x grand champion.
CryptoSlots: $1,000,000 Jackpot & Provably Fair Games
Provably Fair games, exciting wins, huge bonuses. ★CryptoSlots★ is your crypto casino of choice. Sign up in seconds to start winning!