Principal Balanced Advantage Growth

About Principal Balanced Advantage Fund

The scheme aims to achieve capital appreciation over the long-term with comparatively lower volatility. The fund manager will allocate funds into equity assets based on the PE Ratio (Price-Earnings Ratio) levels of the Nifty 50. In order to achieve the balance, the scheme will move its assets from equities to debt/money market instruments if the markets become expensive as compared to the PE Ratio and vice versa.

Pros & Cons of Principal Balanced Advantage Fund

1. Using a dynamic asset allocation strategy, the scheme reduces the risks associated with underperforming markets.
2. This is a good option for investors with a moderate to moderately-high risk tolerance with a long investment horizon. It is also ideal for first-time investors since it keeps away the emotional investing.
3. For the quarter ended Sep 2018, the scheme is ‘Not Ranked’ by CRISIL under the Dynamic Asset Allocation or Balanced Advantage categories.

Fund Information and Statistics of Principal Balanced Advantage Fund

i) Inception/ Launch date

Principal Balanced Advantage Fund was launched on 16 December 2010 by Principal Mutual Fund.

ii) Risk level

Since the scheme follows a dynamic asset allocation strategy, it has a moderately high investment risk associated with it. Further, it is recommended for investors with a long investment horizon (> 5 years).

iii) Redemption

The minimum redemption amount is Rs. 500 or 50 units. The Mutual Fund shall dispatch the redemption proceeds within 10 business days of receiving the request.

iv) Fund Manager

Mr. P.V.K. Mohan has been managing the equity portion of the scheme since July 2017. Additionally, Ms. Bekxy Kuriakose has been managing the debt portion of the scheme since January 2018.

v) Entry / Exit load

There is no entry load for investing in this scheme. If the units are redeemed or switched within 1 year from the date of allotment, then only 24 percent of the units will be allowed to be redeemed or switched free of charge. All units in excess of the 24 percent limit will be charged an exit load of one percent. Also, redemption will be done on a First-In-First-Out basis. There is no load for redemptions or switches after one year.

Tax benefits of investing in Principal Balanced Advantage Fund

All short-term capital gains (STCG) are taxed at 15 percent. On the other hand, the long-term capital gains (LTCG) of up to one lakh rupees are tax-free and LTCG in excess of one lakh rupees are taxed at 10 percent without indexation benefits. Dividends are tax-free in the hands of the investor but are paid after deducting the Dividend Distribution Tax (DDT) of 10 percent.

About Principal Mutual Fund

Principal Mutual Fund started its operations in India in the year 2000. Taking a leaf out of the book of its parent company – Principal Financial Group, headquartered in the USA, the company offers quality investment and long-term financial solutions.