SBI MF Launches NFO with Dynamic Asset Allocation for Balanced Growth

The NFO is an open-ended Fund of Funds scheme designed to provide investors with a dynamic mix of equity and debt exposure. By investing in actively managed mutual funds, the scheme aims to generate long-term capital appreciation while balancing risk and return. Depending on market conditions, the fund will flexibly shift allocations between equity (35–65%), debt (0–65%), and up to 5% in money market instruments. This “one-fund solution” is suitable for investors seeking diversification without having to choose multiple funds individually. Managed by experienced fund managers, the NFO provides systematic investment options and is benchmarked against the NIFTY 50 Hybrid Composite Debt 50:50 Index.

About SBI Mutual Fund

As of July 31, 2025, SBI MF had assets under management of around ₹12.00 lakh crore. It operates as a joint venture between State Bank of India (SBI) and Amundi, Europe’s leading asset manager.

Key Features of SBI Dynamic Asset Allocation Active FoF

• Opening Date: August 25, 2025
• Closing Date: September 8, 2025
• Exit Load: 1% if redeemed within 1 year, Nil thereafter
• Minimum Investment Amount: ₹5,000 (multiples of ₹1 thereafter)

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Objective of SBI Dynamic Asset Allocation Active FoF

The objective of the SBI Dynamic Asset Allocation Active FoF - Direct is to generate long-term capital appreciation by investing in a mix of actively managed equity-oriented and debt-oriented mutual fund schemes. While the fund seeks to provide diversification and dynamic allocation, it does not guarantee achievement of its stated objective.

Investment Strategy of SBI Dynamic Asset Allocation Active FoF

• Invests in a flexible mix of actively managed equity and debt mutual funds.
• Equity allocation: 35–65% based on market trends.
• Debt allocation: 0–65% to balance volatility.
• Up to 5% may be placed in money market instruments such as cash and repos.
• Actively shifts allocations to optimise returns during varying market cycles.
• Primarily invests in schemes of the same fund house, while also having the option to allocate to other mutual fund houses.

Risks Associated with SBI Dynamic Asset Allocation Active FoF

• Market Risk: Returns may fluctuate due to volatility in equity and debt markets.
• Interest Rate Risk: Debt holdings may be impacted by rising or falling interest rates.
• Liquidity Risk: Certain underlying schemes may face low liquidity, affecting performance.
• Concentration Risk: Heavy reliance on underlying schemes of the same fund house may limit diversification.
• No Guarantee: The scheme does not assure returns, and actual results may vary from expectations.

Risk Mitigation Strategy SBI Dynamic Asset Allocation Active FoF

The SBI Dynamic Asset Allocation Active FoF - Direct seeks to manage risks through diversification across equity, debt, and money market instruments, reducing overexposure to a single asset class. Dynamic reallocation allows the scheme to adjust between growth-focused equities and stable fixed-income securities based on evolving market conditions. By actively selecting high-quality mutual fund schemes within each asset class, the fund managers aim to balance risk and reward. Furthermore, exposure limits are in place to prevent overconcentration in any one instrument.

What Type of Investor Should Invest in SBI Dynamic Asset Allocation Active FoF?

• Investors seeking long-term wealth creation through active asset allocation.
• Those looking for a single, diversified solution instead of choosing multiple funds.
• Moderate to high-risk investors are comfortable with market fluctuations.
• Individuals with a medium- to long-term investment horizon.

Where Will SBI Dynamic Asset Allocation Active FoF - Direct Invest?

• Units of actively managed equity mutual funds.
• Units of actively managed debt mutual funds.
• Up to 5% in money market instruments, including cash, repos, and equivalents.
• Primarily in schemes of the same fund house, with flexibility to invest in other mutual funds as required.

Conclusion

The SBI Dynamic Asset Allocation Active FoF provides investors with not only a flexible but also diversified approach to wealth creation by actively balancing equity and debt. With multiple SIP options as well as professional management, it offers a convenient single-window solution for long-term investors.