InvestorQ : What is the Mars concept in Mutual find Investment?
nishi Shah made post

What is the Mars concept in Mutual find Investment?

Purvesh answered.
3 years ago
MARS stands for Mutual Fund Automated Portfolio Rebalancing System. This gives clients access to a range of well-diversified portfolios to choose from. Under MARS there are two broad sets of allocation portfolios:

a.Dynamic Asset Allocation: Under this type of allocation, the debt and equity mix would depend upon the risk in equity markets, the higher the risk in the equity market, the lower will be the equity mix, and vice-versa.

b.Fixed Asset Allocation: The asset allocation between equity and debt shall be fixed.

The asset allocation under MARS shall be done by a team of experts and will be selected accordingly. Rebalancing under the scheme shall be done quarterly for dynamic asset allocation and yearly for fixed asset allocation.

The biggest advantage of MARS is that the client can choose the desired portfolio according to his requirements and long-term goals or investment needs. As a result of disciplined asset allocation, the returns are comparatively better.

How does it work?

    • Portfolios designed by a team of experts are made available on the platform of service providers.
    • The client has an option to choose from the available options of portfolios.         
    • The clients can either buy into MARS by transferring their existing portfolios or can buy a new portfolio. However, the transfer option is available with some MF service providers only.
    • Rebalancing of the portfolio shall be done as scheduled. However, the client will be required to authorize the same to realign the portfolio with targeted asset allocation.

The dynamic asset allocation has been further classified into other categories such as:
Dynamic Asset Allocation – Conservative Portfolio
Dynamic Asset Allocation – Moderate Portfolio
Dynamic Asset Allocation – Aggressive Portfolio