Hybrid Mutual Funds

Types of Hybrid Funds in India

Hybrid funds offer investors a combination of equity and debt investments tailored to suit different risk profiles and investment goals. Here is a simple overview of their main types:

1. Conservative Hybrid Funds:The Conservative hybrid funds are a mix of debt (such as bonds, government securities and treasury bills), giving superior returns with robust risk management. These are best suited for low-risk takers looking to maintain the desired debt-equity ratio.
2. Balanced Hybrid Funds:Balanced hybrid funds are equity-oriented schemes that provide investors who prioritize both growth and stability with an appealing investment choice. These funds maintain an allocation of 60% equity stocks to 40% debt stocks for optimal portfolio results.
3. Aggressive Hybrid Funds: Aggressive hybrid funds specialize in stocks, investing 65-95% in stocks and 20-35% in debt investments. Their aim is to achieve higher returns with greater risks; as a result they're an attractive choice for investors willing to take moderate to high risks.
4. Dynamic Asset Allocation Funds:With these funds, fund managers have full discretion in allocating stocks and bonds according to market conditions in order to attain optimal returns in ever-evolving markets. Such Mutual Funds provide significant flexibility.
5. Multi-Asset Allocation Funds: These investments typically invest across various assets, such as equity, debt, and an additional class, such as real estate or commodities, to diversify risk and achieve sustainable growth.
6. Arbitrage Funds:Arbitrage funds make rapid trades to capitalize on price differences among stocks listed on various exchanges, with low-risk trades that focus primarily on cash or cash-like investments.
7. Equity Savings Funds: Equity savings funds utilize a blend of equity, debt and arbitrage investments to produce returns; at least 65% goes toward equity and 10% each to debt and arbitrage - making them suitable for conservative investors who desire balanced growth.

Each hybrid fund offers a different balance between risk and return, so investors should select their ideal hybrid fund according to their financial goals and risk tolerance.

The 3 Best Hybrid Funds for SIP

Let's have a closer look at the 3 best hybrid funds for you to invest in 2025:

ICICI Prudential Multi Asset Fund: The ICICI Prudential Multi Asset Fund was launched on October 31, 2002, with a current AUM of Rs.50,648 Crores, following a diversified investment approach while investing 70% in equity and remaining in debt, gold, silver and REITs. It’s managed by Mr. Sankaran Naren, known for his strategy of picking stocks that others might overlook, known as contrarian strategy. The fund’s goal is to help your money grow steadily over time by investing in different areas and trying to beat the market in the long run.

HDFC Balance Advantage Fund: Launched on February 1, 1994, HDFC Balanced Advantage Fund has ₹94,865.65 Crore in assets as of October 31, 2024. The fund invests at least 65% in stocks, focusing on strong, growing companies and the rest in safer debt instruments. This mix helps balance risk and reward, making it a good option for long-term investors looking for growth with lower risk.

ICICI Prudential Equity & Debt Fund: After being launched on November 05, 1999, ICICI Prudential Equity & Debt Fund is amongst the oldest schemes in its category. It holds a robust AUM (asset under management) at Rs.40,203 Crores as of October 31 2024. ICICI analyses investments across equity, debt and commodities to balance the risk for long, steady growth. It's a top pick if you seek steady, well-rounded, strong performance.

How to Invest in Hybrid Funds via MySIPonline?

Here is how MySIPonline makes investing in hybrid funds simple:

1. Create an Account

Sign up, complete KYC requirements, and set up auto-debit payments so that regular SIP payments won't require manual effort from you.

2. Enable Auto-Debit Payments

Automate payments so you don't need to remember manual payments every month or biweekly instalments.

3. Select Your Fund

Select a hybrid fund that best meets your goals or ask an advisor for assistance.

4. Make Your First Payment

To make the initial payment for your fund, add it to your cart, select your SIP date and pay.

5. Monitor Your Investments

Our dashboard enables you to keep an eye on how it's performing over time.

For optimal results, invest using a SIP to build up your wealth gradually over time.