Invest in multi-asset funds for protection against downside risk

Be prepared, however, for these funds to lag when there's a bull run in equities

Debt and gold funds currently outperform the major diversified-equity categories over the one-year horizon. With equities likely to struggle in the near future, investors need to pursue a diversified portfolio strategy. Multi-asset allocation (MAA) funds can help them do so.

Investment style

These funds must invest in at least three asset classes, with a 10 per cent allocation to each. While most offer exposure to equities, debt, and gold, some also invest in real estate and infrastructure investment trusts and international equities.

Most MAA funds have a defined asset allocation range they operate within. Says Chintan Haria, head-investment strategy, ICICI