In good times and bad

Aggressive hybrid funds have always been given the cold shoulder. Despite packing in standout features - predictable equity-debt allocation, tax-efficient auto-rebalancing and favourable equity taxation - they have found few takers. Yet, they deserve a pat on the back. Here's why: These funds offer you the best of both worlds; they generate good returns while providing some much-needed downside protection at crunch times. Moreover, even when equity as an asset class has grown remarkably in the financial year gone by, these funds have managed to impress on the performance front. In the last financial year, aggressive hybrid funds delivered 31.1 per cent annual returns, despite owning debt securities. While this may pale in comparison to BSE 500 TRI's 40.2 per cent, they comfortably beat the Sensex, which delivered about 26.5 per cent. In fact, their performance remained fairly consistent between April 2023 and March 2024. It also remained steadfast in the face of market volatility in the January-March period. Their performance stands out when it comes to cushioning the downside, too. March 2020 is Exhibit A. At a time when the market shrank 23.9 per