Portfolio that combines a stock component, a bond component and, sometimes, a money market component, in a single portfolio. Generally, these hybrid funds stick to a relatively fixed mix of stocks and bonds that reflects either a moderate (higher equity component) or conservative (higher fixed-income component) orientation.
Advantages of Balanced Portfolios:
A balanced fund is geared toward investors who are looking for a mixture of safety, income and modest capital appreciation. The amounts that such a mutual fund invests into each asset class usually must remain within a set minimum and maximum.
This type of fund is semi-liquid. The balanced nature of the fund gives investors enough room to strategically maneuver their assets in a short-term period according to their needs.
Investment Criteria
• Cash: A very small portion of the portfolio (not more than 10%) is invested in an interest bearing Bank accounts to provide liquidity for the client and for the company if an investment opportunity arises.
• Treasury Bills: A small portion of the portfolio (not more than 20%) is invested in treasury bills with a maximum of one year dependent on the expected return and the economic indicators which are analyzed weekly.
• Bonds: A small portion of the portfolio (not more than 20%) is invested in the Egyptian bond market targeting a long term maturities and the highest coupon rates.
• Equity Market: The bulk of the portfolio (not less than 50%) is invested in stocks listed in the Egyptian stock market and international markets.
The movement between investment instruments is in accordance of the company’s investment committee’s view and strategies.
