Bajaj Finserv launches innovative balanced advantage fund

India: Bajaj Finserv Asset Management has introduced the Bajaj Finserv Balanced Advantage Fund (BAF), an open-ended dynamic asset allocation fund. This fund caters to investors interested in equity, equity-related instruments (including derivatives), and fixed-income instruments.

Employing a distinctive investment model merging behavioral sciences with financial insights, the Bajaj Finserv BAF aims to help investors navigate market volatility and maximize returns. Unlike conventional methods relying solely on quantitative models, the Bajaj Finserv AMC's approach involves analyzing behavioral aspects, potentially leading to improved long-term returns.

While the typical strategy involves fundamental analysis and quantitative models for asset allocation, Bajaj Finserv AMC integrates behavioral science models to determine both asset allocation and investment timing.

The Bajaj Finserv AMC BAF model evaluates fair market value based on future earnings per share, growth expectations, and interest rates. This model aids in navigating market volatility, optimizing returns by fine-tuning entry and exit points, and guiding equity allocation based on market valuation.

CEO Ganesh Mohan emphasized their novel approach, combining Behavioral Sciences and Financial Insights, asserting its impact on investment decisions. He anticipated a rise in industry discussions about behavioral sciences-based ideas and products.

CIO Nimesh Chandan highlighted the fallacy of blindly following market trends and stressed the importance of recognizing overreactions driven by greed or fear. Their asset allocation strategy amalgamates fundamental analysis and behavioral cycle studies, leveraging fundamental analysis for fair value assessment and behavioral analysis for detecting shifts in market bias.

The fund will be managed by Nimesh Chandan, Sorbh Gupta handling equity, and Siddharth Chaudhary overseeing debt. The new fund offer starts on November 24 and ends on December 8, 2023.