Invest in Best Aggressive Hybrid Funds in India 2024
Discover the best ultra-short-term mutual funds in India for 2024. Learn who must invest, benefits, risks, and what the benefits are.
What are Aggressive Hybrid Funds?
Aggressive Hybrid Funds are a type of mutual fund that invest in a mix of equity and debt instruments, with a higher allocation towards equities (typically 65-80%) and the balance in debt. These funds invest in instruments with high risk underlying assets that potentially give high capital gains. An investor of hybrid funds has technically invested in both equity and debt markets.
Who Should Invest in Aggressive Hybrid Funds?
- Moderate Risk Investors: Investors who are not risk-averse can invest in this fund as a considerable chunk of your investment goes into equity
- First-Time Equity Investors: Those transitioning from debt instruments to equity investments, seeking a mix of growth and stability can try investing in this hybrid funds as they get considerable equity exposure
- Long-Term Investors: Individuals with a long-term investment horizon should only try this funds as the funds likely show good results over a longer time period
- Diversified Portfolio Seekers: Investors who are looking for diversification of their portfolio can opt for this aggressive hybrid funds
Best Performing Aggressive Hybrid Mutual Funds
| Fund Name | Category | Risk | 6 Months Return | 1 Year Return | Rating | Fund Size (Crores) |
|---|---|---|---|---|---|---|
| ICICI Prudential Equity and Debt | Aggressive Hybrid | Very High | 16.58% | 37.48% | 5 | 37,036 |
| JM Aggressive Hybrid Fund | Aggressive Hybrid | Very High | 22.62% | 53.31% | 5 | 383 |
| Edelweiss Aggressive Hybrid Fund | Aggressive Hybrid | Very High | 16.84% | 32.66% | 5 | 1,860 |
| Quant Absolute Fund | Aggressive Hybrid | Very High | 19.31% | 37.23% | 4 | 2,216 |
| Kotak Equity Hybrid | Aggressive Hybrid | Very High | 19.29% | 31.73% | 4 | 6,044 |
Factors to Consider While Investing in Aggressive Hybrid Funds
- Equity Allocation: Understand the fund’s equity allocation as it comes with increased risk, you need to check whether it matches with your investment goals
- Debt Quality: Assess the quality of the debt instruments as they come to your rescue in the event equity doesn’t provide the expected returns
- Fund Manager’s Expertise: Evaluate the track record of the fund manager in handling this fund
- Historical Performance: Analyze the performance of the fund under different market cycles so that it will give you an idea of how this fund will perform in the future
- Expense Ratio: A Lower expense ratio would result in better profit margin
Major Benefits of Aggressive Hybrid Funds
- Balanced Risk-Return: Provides a balanced approach with respect to risk and return by combining equity and debt.
- Diversification: Offers diversification across asset classes, reducing overall portfolio risk.
- Potential for High Returns: The equity portion can provide significant capital appreciation over a long time of staying invested
- Debt for stability: The debt portion adds stability to your investments. In a bearish market, they can boost up the debt fund while maintain the
- Professional Management: These funds are managed by professional fund managers with decades of experience. They analyze a lot before making any investment
Risks Involved in Aggressive Hybrid Funds
- High Risk stocks: Aggressive funds invest in high-risk stocks, and these stocks can generate better returns
- Low Diversification: Typically, they invest in limited and concentrated stocks, it limits the diversification
- Volatile: Since they invest primarily in equity stocks, they are subject to volatility and therefore increased risk
- Higher Expense ratio: Since the fund treads on both equity and debt areas, the fund manager will have to look after the both, this brings in a higher expense ratio
Frequently Asked Questions (FAQs) about Aggressive Hybrid Funds
1. What are Aggressive Hybrid Funds?
Aggressive Hybrid Funds are those funds which invest in a mixture of equity (65-80%) and debt instruments, aiming to provide capital appreciation through equities and stability through debt.
2. Who should consider investing in Aggressive Hybrid Funds?
People who are risk tolerant, people who would want to move from debt to equity, people with a long investment horizon can try these aggressive hybrid funds
3. Is it safe to invest in Aggressive Hybrid Funds?
In order to reap any reward from an investment, you will have to stay invested for a period of 3+ years. By staying invested for over three years, your investment goes through various cycles
4. What are the risks usually associated with Aggressive Hybrid Funds?
Risks include market risk, interest rate risk, credit risk, asset allocation risk, and volatility
5. How do I choose the best Aggressive Hybrid Fund?
Consider factors like historical performance, your risk tolerance, expense ratio, fund manager’s track record, and your investment goals before choosing the fund. You can seek the assistance of Fincover, whose MF experts would consider you pick the best Aggressive Hybrid fund in the market