Category Review

An underrated star

Aggressive hybrids are often overlooked, but their utility is undeniable

Aggressive hybrids are often overlooked, but their utility is undeniableAdobe Stock

Aggressive hybrid funds may not steal the limelight like their more popular cousins such as dynamic or multi-asset allocation funds, but for investors seeking a predictable, low-maintenance approach to long-term wealth creation, these funds quietly deliver with their no-fuss, balanced asset allocation. These funds invest 65-80 per cent in equity and the rest in debt, giving you an equity-like growth potential with a debt cushion. Think of them as an auto-rebalancing portfolio combining a flexi-cap and short-duration fund. For new investors, or those seeking long-term growth with less anxiety, aggressive hybrids are an excellent starting point. While it may not match the market highs, it softens the lows, giving you a smoother ride. Further, the auto-rebalancing feature and treatment as an equity-oriented fund offers tax advantage. In essence, it's a simplified version of an investor's portfolio across equity-debt, market capitalisation and credit quality. Highlights & trends Performance: Last financial year, they gave 10 per cent returns, beating BSE 500 TRI's 7 per cent. Their defensive nature has been evident during various market falls. In the seven worst market falls in a calend

This article was originally published on April 17, 2025.