NJ Balanced Advantage Fund: Stay Balanced with Rule-Based Investing
When markets rise, investors feel confident and pump in cash. When markets fall, panic sets in and many sell. But what if your investment could automatically balance itself, adapting to market ups and downs without emotion, bias, or second-guessing?
The NJ Balanced Advantage Fund does just that. It’s a hybrid mutual fund that follows a 100% rule-based approach to manage risk and help you navigate ups and down by adjusting its exposure between debt and equity based on fluctuations in the market.
Why does a Balanced Approach matter?
Investing is not just about chasing returns but also about managing the journey. Markets don’t move in straight lines, it is volatile. Markets have rallies, corrections and flat phases. Most of the investors react emotionally during any of these phases, leading to poor timing and missed opportunities.
NJ Balanced Advantage Fund (NJ BAF) takes that burden off from investors’ shoulders. The Dynamic Asset Allocation helps to adjust the exposure in Equity when markets may seem attractive and reduce the exposure when the markets don't seem attractive.
Think of it as an auto-drive mode for your investments. When the road ahead is clear, it accelerates smoothly. When conditions get congested, it slows down for safety, thus ensuring you stay on track towards your financial destination. Just as an auto drive mode helps you reach your destination safely in time, A Balanced Advantage Fund simply lets you stay invested during every market cycle aiming to generate long term wealth with stability.
What is Dynamic Asset Allocation?
Dynamic Asset Allocation refers to changing the proportion allocated to debt and equity based on the current market conditions and economic factors. Among the many approaches to leverage different market situations, one strategy can be to increase equity exposure for growth potential when market valuations decline and decrease it when markets begin to peak to lock in gains. For example, in an expectation of a market downturn, it may shift from 60% equity to 40% to lower the risk, while a traditional balanced fund would remain fixed at 60% equity, potentially facing higher losses.
| Market Fall | Dynamic Asset Allocation Portfolio | 100% Equity Portfolio | |||
| Equity Allocation at Peak | Max Drawdown | Recovery Time | Max Drawdown | Recovery Time | |
| Global Financial Crisis | 29.77% | -32.49% | 70 | -63.71% | 1,977 |
| COVID-19 | 53.04% | -20.38% | 91 | -38.11% | 228 |
Note: Assumed equity investment in Nifty 500 TRI and Debt investment in Nifty 5 Year Benchmark GSec. Based on proprietary Dynamic Asset Allocation Model of NJ Asset Management Private Limited which takes into account market valuation and interest rates. The figures/projections are for illustrative purposes only. The situations/results may or may not materialise in the future. Past performance may or may not be sustained in future & is not a guarantee of any future returns. Recovery time is in calendar days. Above is only for illustration purposes.
Dynamic Asset Allocation helps to minimize drawdowns and enable quicker recoveries, two critical aspects of long-term wealth creation. For instance, a 100% equity portfolio fell by -63.71% and -38.11% during the Global Financial Crisis and COVID-19, respectively. But, a Dynamic Asset Allocation Portfolio fell by just -32.49% and -20.38% respectively during the same time. Smaller drawdowns not only protect your capital but also make it easier and faster to recover. While a 100% equity portfolio took 1,977 days and 228 days to recover from the Global Financial Crisis and COVID-1,9 respectively, the Dynamic Asset Allocation Portfolio recovered in just 70 days and 91 days during the same periods.
Does investing in quality businesses matter?
Quality factor investing identifies companies that have strong financial health with potential for growth over the long-term. Investing in quality companies helps investors to experience smaller losses and significantly faster recoveries during market crashes, which is clearly evident from the table below:
| Market Fall | High Quality Portfolio | NIFTY 500 TRI | Low Quality Portfolio | |||
| Max Drawdown | Recovery Time | Max Drawdown | Recovery Time | Max Drawdown | Recovery Time | |
| Global Financial Crisis | -59.05% | 274 | -63.71% | 1,977 | -77.79% | 2,682 |
| COVID-19 | -36.62% | 151 | -38.11% | 228 | -53.57% | 321 |
Source: NJ Asset Management Private Limited Internal research, CMIE, National Stock Exchange, NJ’s Smart Beta Platform (in-house proprietary model of NJAMC). Total returns used for calculations. High Quality Portfolio and Low Quality Portfolio refer to the NJ Quality+ Model and NJ Low Quality Model, respectively. NJ Quality+ Model and NJ Low Quality Model are in-house proprietary methodologies developed by NJ Asset Management Private Limited. The methodologies will keep evolving with new insight based on the ongoing research and will be updated accordingly from time to time. Recovery time is in calendar days.
NJ Balanced Advantage Fund (NJ BAF)
NJ Balanced Advantage Fund is a disciplined, 100% rule-based, and quality-focused approach to investing is what sets apart. The fund's systematic approach ensures consistent decision-making without emotional biases. With the support of our in-house NJ SmartBeta Platform, the fund rigorously analyzes historical data to refine its strategy through detailed back-testing, increasing its dependability throughout market cycles
Investing in NJ BAF gives investors the benefit of both, investing in a high-quality diversified portfolio and dynamic yet balanced asset allocation based on market conditions.
Key features NJ Balanced Advantage Fund:
NJ Balanced Advantage Fund (NJ BAF) is ideal for investors seeking wealth creation over a long time with a quality-focused approach. Key features of the fund are as follows:
- Quality-Driven Approach: NJ Balanced Advantage Fund focuses on high-quality companies with strong fundamentals, ensuring investments in businesses that have low debt, high and consistent ROEs, and high and consistent dividend payouts.
- Rule-Based Investment Philosophy: With the support of NJ AMC’s proprietary Smart Beta platform, NJ BAF follows a disciplined and process-driven approach to asset allocation and security selection process that eliminates human biases.
- Genuine Diversification: The fund offers a unique portfolio that provides the benefits of diversification as it has low overlap with the index.
- Dynamic Asset Allocation (DAA): Through Dynamic Asset Allocation, NJ BAF seeks to provide effective risk management in both bullish and bearish markets, by balancing stability with growth potential according to market conditions.
Performance of NJ Balanced Advantage Fund
The NJ Balanced Advantage Fund’s regular plan has delivered an average 2-year rolling return of 15.29%, outperforming both the category average (14.36%) and benchmark (11.94%). It outperformed the benchmark in 99.15% of observations and the category median in over 73.68% of instances, highlighting its consistency. With zero negative return periods over a 2 year period and over 83.64% of observations above 12.00% returns, the fund demonstrates strong, steady performance and effective risk management through its disciplined, 100% rule-based approach.
| 2 YEAR ROLLING STATS | ||||
| Particular | NJ BALANCED ADVANTAGE FUND | CATEGORY AVERAGE (EXCLUDING NJ BALANCED ADVANTAGE FUND) | CATEGORY MEDIAN (EXCLUDING NJ BALANCED ADVANTAGE FUND) | NIFTY 50 HYBRID COMPOSITE DEBT 50:50 INDEX |
| Number of Observations | 703 | 703 | 703 | 703 |
| Average Return | 15.29% | 14.36% | 13.98% | 11.94% |
| Median Return | 14.87% | 14.63% | 14.41% | 12.00% |
| Minimum Return | 4.97% | 5.81% | 5.24% | 4.54% |
| Maximum Return | 23.22% | 20.08% | 19.52% | 17.05% |
| Outperformance Against Benchmark (%) | 99.15% | - | - | - |
| Outperformance Against Category Average (%) | 64.86% | - | - | - |
| Outperformance Against Category Median (%) | 73.68% | - | - | - |
| Observations with Return > 12% (%) | 83.64% | 83.07% | 82.22% | 50.21% |
| Negative Return Observations (%) | 0.00% | 0.00% | 0.00% | 0.00% |
Source: NJ Asset Management Pvt. Ltd., ICRA MFI Explorer. Performance shown above is from 29th October 2021 (Inception date of NJ Balanced Advantage Fund) to 30th September 2025. All open-ended schemes in the Balanced Advantage category that are live on 31st August 2025 have been considered. For the calculation of daily rolling returns for any particular day, all schemes that have a history of at least 2 years as of the date of calculation have been considered. Past performance may or may not be sustained in future and is not an indication of future return.
Conclusion:
In a world where market sentiment can change overnight, discipline is the real edge.
The NJ Balanced Advantage Fund (NJ BAF) brings that discipline through a combination of 100% rule-based, quality-focused equity investment and a dynamic asset allocation strategy.
When your investments are built on rules, not reactions, balance truly leads to better outcomes. NJ Balanced Advantage Fund: Your all-weather partner for smart, steady, and balanced investing because in the end, Balance Hai Toh Behtar Hai.
FAQs:
1) How can I invest in NJ BAF?
Contact your Financial Advisor or visit the following link to start your investment journey with NJ Balanced Advantage Fund.
2) What makes NJ BAF different from other Balanced Advantage Funds?
NJ BAF uses a data-driven, rule-based model and a quality-focused equity portfolio, eliminating emotional biases or reactive decision-making.
3) How does NJ BAF decide when to change equity and debt allocations?
The fund follows a pre-defined rule-based model that considers market valuations, volatility, and other indicators, ensuring systematic, unemotional allocation changes.
The riskometer is based on the portfolio of September 30, 2025 and is subject to periodic review and change, log onto www.njmutualfund.com for updates
Investors are requested to take advice from their financial/ tax advisor before making an investment decision.
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.
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