Multi-Asset Funds Soar on Gold & Silver Rally: Stellar 2025 Returns
Overview
Multi-asset funds delivered exceptional returns in 2025, driven by a significant rally in gold and silver prices, with silver more than doubling and gold returning 60%. These funds diversify across asset classes, cushioning risk and lowering volatility. Assets under management for this category surged 59% to ₹163,731 crore, reflecting growing investor confidence in their capital protection and inflation-beating potential amidst global uncertainty.
Stellar 2025 Performance
Multi-asset funds emerged as top performers in 2025, driven by a dramatic surge in precious metals. Silver prices more than doubled, while gold posted a robust 60% return, propelling these diversified investment vehicles ahead.
Fund Performances Shine
Individual fund performances underscored the category's strength. The Nippon India Multi Asset Allocation Fund delivered a remarkable 23% annualized return over three years and 22% in 2025. Similarly, the UTI Multi Asset Allocation Fund returned 13% and 22% over three years and one year, respectively. HDFC Multi Asset Allocation Fund posted 15% and 17% over the same periods.
Asset Under Management Skyrockets
Investor appetite for these funds surged, with assets under management climbing 59% from ₹103,320 crore in December 2024 to ₹163,731 crore by the end of 2025, according to AMFI data. This significant inflow signals a growing preference for balanced portfolios in uncertain economic conditions.
The Power of Diversification
The core appeal of multi-asset funds lies in their diversification strategy. By spreading investments across equities, debt, gold, and silver, these funds cushion against sharp declines in any single asset class, thereby reducing overall portfolio risk and volatility. This approach aims to protect capital while seeking inflation-beating returns.
Navigating Global Uncertainty
Amidst what some analysts describe as a potential global reserve currency reset and increased market volatility, multi-asset strategies offer a compelling solution. Sandeep Parwal, Founder of SPA Group, noted that the current environment necessitates a focus on capital protection and value-driven asset rotation. Multi-asset funds effectively address these evolving investor priorities within a single product. However, the inherent volatility of metals, particularly silver's recent swings exceeding 10% in a single day, warrants caution.
