Should I choose a flexi cap or aggressive hybrids to set up an SWP?

Considering market ups and downs, which category of fund among flexi cap and aggressive hybrids would you suggest to set up an SWP with a three per cent withdrawal rate?
- Jhumki

I would say that an aggressive hybrid fund will be good. Aggressive hybrid funds are almost like equity funds. Many aggressive hybrid funds allocate 75 per cent to equity. But still, having a fixed income allocation in any long-term investment allocation is good.

Moreover, three per cent is a fairly conservative withdrawal rate. I don't visualise a situation where you run the risk of consuming your capital even with a big drawdown in between.

This article was originally published on May 19, 2021.