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Balanced funds

Balanced funds invest in both fixed income and equity markets. These funds are suitable for you if you are looking for a diversified and convenient option for long-term investment.

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What are balanced funds?

When you invest in our funds, the risks of investment will be reduced thanks to diversification. The funds' assets are spread over different markets and sectors, and therefore they offer access to several different investment alternatives. Funds are suitable for investors who want professionals to manage their investments according to the market situation.

  • Minimum subscription: 10 euros
  • The portfolio manager monitors the markets: when equity prices are expected to decline, the weight of fixed income investments is increased and vice versa.
  • You can buy and sell fund units at any time.

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Balanced funds invest in fixed income and equity markets

Balanced funds invest both in equities and fixed income instruments, and the proportion of either asset class in a fund's investments can be altered according to the market situation. The minimum and maximum level for each asset class is stated in each fund's rules.

The weights of fixed income and equity market investments in a balanced fund determine its level of risk and return. The expected long-term return is influenced by how assets are distributed over fixed income and equity markets in normal market conditions.

Risk is affected by the amount of equity investments

The risk involved in a balanced fund is influenced by

  • the division of the fund's investments among fixed income instruments and equities
  • the interest rate and credit risk of the fixed income investments and 
  • the equity market risk of the equity investments.

Balanced funds are exposed to higher risks than fixed income funds since a part of the funds' assets is invested in equities, and lower risks than in equity funds because fixed income investments bring stability.

Various types of funds on offer

Investments can also be geographically diversified over different regions. For example, Nordea's funds for savers selection also includes balanced funds: Savings 15, Savings 30, Savings 50 and Savings 75. They invest their assets primarily in Nordea's other fixed income and equity funds, but can also make direct investments. Funds provide access to hundreds of different investment products.

Return and risk

Risk is affected by the amount of equity investments

The risk involved in a balanced fund is influenced by

  • the division of the fund's investments among fixed income instruments and equities
  • the interest rate and credit risk of the fixed income investments and 
  • the equity market risk of the equity investments.

Balanced funds are exposed to higher risks than fixed income funds since a part of the funds' assets is invested in equities, and lower risks than in equity funds because fixed income investments bring stability.

The risk level is determined by the proportion of equities in the balanced fund. For example, 30% of the Savings 30 Fund's assets are invested in equity markets, so its risk exposure is lower than in the Savings 75 Fund, which invests 75% of its assets in equities.

The value of fund units may increase or decrease depending on the market situation. The investor may lose a part or all of the invested capital.

The funds are managed by Nordea Funds Ltd.

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