Best Hybrid Funds~

Hybrid mutual funds combine equity and debt investments to offer a balanced approach to wealth creation and risk management. They provide better returns than pure debt funds while being less volatile than pure equity funds, making them ideal for investors seeking moderate risk and steady growth. With various types available, hybrid funds cater to different financial goals and risk appetites, making them one of the best investment options for both new and experienced investors.

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10.5 Crore
Registered Consumer
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Insurance Partners
5.3 Crore
Policies Sold
Fund Details
Fund Size
NAV
5 Year
7 Year
10 Year
High Growth Fund
Fund Size: 9,928 Cr
9,928 Cr
116.7 -0.60%
27.23% Highest Returns
21.83%
18.4%
Get Details
Top 200 Fund
Fund Size: 2,323 Cr
2,323 Cr
178.67 -1.91%
30.78% Highest Returns
22.34%
17.46%
Get Details
Accelerator Mid-Cap Fund II
Fund Size: 5,652 Cr
5,652 Cr
83.19 -0.40%
23.59% Highest Returns
13.57%
14.73%
Get Details
Opportunities Fund
Fund Size: 37,289 Cr
37,289 Cr
78.13 -0.49%
25% Highest Returns
15.59%
14.71%
Get Details
Equity II Fund
Fund Size: 3,556 Cr
3,556 Cr
42.15 -0.33%
19.29% Highest Returns
10.82%
10.2%
Get Details
Accelerator Fund
Fund Size: 236 Cr
236 Cr
49.78 -0.39%
23% Highest Returns
15.76%
13.35%
Get Details
Grow Money Plus Fund
Fund Size: 440 Cr
440 Cr
68.73 -0.48%
20.42% Highest Returns
14.45%
13.81%
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Multiplier
Fund Size: 4,557 Cr
4,557 Cr
94.84 -0.72%
25.88% Highest Returns
14.93%
15.51%
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Equity Top 250 Fund
Fund Size: 539 Cr
539 Cr
58.41 -0.35%
19.7% Highest Returns
12.68%
11.51%
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Future Apex Fund
Fund Size: 101 Cr
101 Cr
57.71 -0.59%
23.82% Highest Returns
15.92%
13.34%
Get Details
Opportunities Fund
Fund Size: 3,368 Cr
3,368 Cr
59.78 -0.48%
22.7% Highest Returns
14.04%
12.36%
Get Details
Frontline Equity Fund
Fund Size: 4,348 Cr
4,348 Cr
69.41 -0.54%
23.77% Highest Returns
15.66%
14.08%
Get Details
Flexi Growth Fund
Fund Size: 717 Cr
717 Cr
11.82 -0.09%
-
-
-
Get Details
Virtue II
Fund Size: 3,248 Cr
3,248 Cr
70.77 -0.67%
24.25% Highest Returns
17.4%
15.09%
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Pension Dynamic Equity Fund
Fund Size: 6 Cr
6 Cr
73.66 -0.52%
18.95% Highest Returns
12.06%
10.83%
Get Details
Equity Fund
Fund Size: 78,278 Cr
78,278 Cr
206.47 -1.88%
19.71% Highest Returns
13.04%
11.79%
Get Details
Blue-Chip Equity Fund
Fund Size: 1,335 Cr
1,335 Cr
35.21 -0.21%
16.68% Highest Returns
11.12%
10.16%
Get Details
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Best ULIP Funds - Consider the best performing ULIP funds to invest in 2025 with Policybazaar. Find the list of best ULIP funds in India on the basis of Returns, Latest Nav, Fund Size and Categories

Data source : value research

Returns as on 08-07-2025. The returns are the returns of best-performing fund in the plan

Disclaimer :
˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

Top Hybrid Mutual Funds in India

Below is the list of the best hybrid funds:

Scheme Name 3 Years Return (p.a.)
JM Aggressive Hybrid Fund 22.59%
HDFC Balanced Advantage Fund 20.87%
Nippon India Asset Allocator FoF 19.95%
UTI Multi Asset Allocation Fund 19.92%
ICICI Prudential Retirement Fund - Hybrid Aggressive Plan 19.77%
ICICI Prudential Multi Asset Fund 19.75%
ICICI Prudential Equity & Debt Fund 19.68%
Quant Multi Asset Fund 19.4%
Kotak Multi Asset Allocator FoF - Dynamic 19.12%
Edelweiss Aggressive Hybrid Fund 19.12%

What are Hybrid Funds?

Hybrid funds are mutual funds that invest in a combination of equity (stocks) and debt (bonds, fixed-income securities) to achieve the investment objective of the scheme. Each hybrid fund features a unique allocation between equity and debt, catering to different investor profiles and financial goals. This blend allows investors to benefit from the growth potential of equities while enjoying the stability offered by debt instruments.

Features of Hybrid Mutual Funds

  1. Mixture of Asset Classes

    Hybrid funds maintain a diversified portfolio, investing across equities, debt, and sometimes other assets, allowing investors to access multiple asset classes through a single fund.

  2. Balanced Approach

    These funds aim for a well-balanced portfolio, striving to deliver higher returns with lower risks. The equity portion drives long-term wealth creation, while the debt component cushions against market volatility, helping investors meet both short-term and long-term financial objectives.

  3. Varied Investment Combinations

    Hybrid mutual funds offer different equity-debt mixes, designed to suit risk appetites of various investors, from conservative to aggressive.

  4. Long-Term Performance

    Hybrid funds are best suited for investors who can stay invested for at least three to five years, as they tend to perform well over the long term.

Types of Hybrid Funds

Below are the different types of hybrid mutual funds available:

  1. Equity-Oriented Hybrid Funds

    Equity-oriented hybrid funds, sometimes called aggressive hybrid funds, invest at least 65% of their assets in equities and the remainder in debt instruments. These funds are designed for investors seeking higher growth potential but still want some stability from debt exposure.

  2. Debt-Oriented Hybrid Funds

    Debt-oriented hybrid funds, on the other hand, allocate 60% or more of their assets to fixed-income securities like bonds, government securities, and debentures, with the balance in equities. These funds are suitable for conservative investors who prioritize capital preservation and steady income, but still want some equity exposure for growth.

  3. Balanced Funds

    Balanced funds maintain a moderate allocation, usually between 40% and 60% in both equity and debt. This even split helps reduce the volatility associated with pure equity funds, making them appealing to investors seeking a balance between risk and return.

  4. Monthly Income Plans (MIPs)

    Monthly Income Plans (MIPs) are hybrid funds that primarily invest in debt instruments, typically allocating 70% to 80% of their portfolio to fixed-income securities and the rest to equities. The main objective is to provide regular income, making these funds suitable for retirees or those seeking supplementary monthly cash flow.

  5. Arbitrage Funds

    Arbitrage funds use a strategy of buying stocks in one market and simultaneously selling them in another to exploit price differences. These funds usually maintain at least 65% in equities but aim to deliver stable, debt-like returns with lower risk by hedging their positions. They are ideal for investors looking for safety similar to debt funds but with the tax benefits of equity funds.

  6. Other Types: Dynamic Asset Allocation and Multi-Asset Allocation Funds

    Other notable types include dynamic asset allocation or balanced advantage funds, which can shift their allocation between equity and debt entirely based on market conditions, and multi-asset allocation funds, which invest in at least three asset classes, such as equity, debt, and gold, to further diversify risk and return.

How Does a Hybrid Fund Work?

A hybrid mutual fund works by creating a balanced portfolio that aims to provide regular income and long-term capital appreciation. The fund manager allocates investments between equity and debt instruments according to the scheme's objective. The allocation is actively managed-assets are bought or sold based on market conditions to optimize returns and manage risk. This dynamic approach helps hybrid funds adapt to changing market scenarios while maintaining their target asset mix.

How Much Should You Invest in a Hybrid Fund?

The amount you should invest in hybrid funds depends on your financial goals, investment horizon, and risk tolerance. Hybrid funds are ideal for investors seeking moderate risk and balanced returns. They are especially suitable for new investors who want to experience equity markets with the safety net of debt allocation. Using a SIP calculator can help you plan regular investments and estimate future corpus based on your investment options.

Tax Rules of Hybrid Mutual Funds

Taxation of hybrid mutual funds depends on the proportion of equity and debt in the fund:

  1. Equity Component

    • Long-Term Capital Gains (LTCG) above ₹1 lakh are taxed at 10% without indexation.

    • Short-Term Capital Gains (STCG) are taxed at 15%.

  2. Debt Component

    • Gains are added to your income and taxed as per your income tax slab.

    • Long-term capital gains from the debt portion are taxed at 20% after indexation or 10% without indexation.

Hybrid funds with a higher equity allocation (hybrid equity funds) are taxed like equity funds, while those with a higher debt allocation follow debt fund tax rules. This makes understanding the fund's asset allocation crucial for tax planning, especially when comparing with other investment options like ULIP plans.

Conclusion

Hybrid funds offer a smart balance of growth and stability, making them suitable for diverse investor needs. By blending equity and debt, they help manage risk while aiming for attractive returns, making them a valuable addition to any investment portfolio.

Frequently Asked Questions

  • How do hybrid funds manage risk?

    Hybrid funds manage risk by diversifying investments across asset classes. The equity component offers growth potential, while the debt component provides stability and protection against market volatility, resulting in a more balanced risk-return profile.
  • Are hybrid funds better than pure equity or debt funds?

    Hybrid funds offer a middle ground. They are generally less risky than pure equity funds and have the potential to deliver better returns than pure debt funds. The best choice depends on your investment objectives, time horizon, and risk tolerance.
  • Can I withdraw money from a hybrid fund anytime?

    Yes, most hybrid funds are open-ended, allowing you to redeem your investment at any time. However, some funds may have exit loads if you withdraw within a specified period.
  • Are hybrid funds suitable for long-term investment?

    Yes, hybrid funds are well-suited for long-term investment horizons (typically 3-5 years or more), as this allows the equity component to grow while the debt portion manages risk.
  • Can minors invest in funds?

    Yes, minors represented by parents/guardians are allowed to invest in mutual funds^^. The legal age for investing in mutual funds independently is above 18 years.   
  • Do we get a passbook after investing in mutual funds?

    No, mutual funds do not issue passbooks like banks. However, you get the account statements from the fund agency or manager about your fund's performance. You can even track your investment portfolio online very easily. 
  • What happens to the investment corpus if the investor passes away mid-scheme?

    It is mandated by the governing bodies to appoint nominees in the mutual funds' investment scheme. In case of any eventuality, the nominee will get hold of the fund's dealings and will yield the returns. If the nominee is also absent, then the returns will be directed towards the next kin of the investor. 
  • Is it necessary to have a fund manager?

    Yes. Investing in the funds and the asset allocation of the hybrid funds requires expertise to yield better risk-free returns. The fund manager will take care of your finances by curating a portfolio better suited for you. However, you will be completely in charge of the buying and selling of your units as well as the returns you gain. 
  • What is an expense ratio?

    The expense ratio is the fee charged by the fund manager for managing your funds. The expense ratio will make up the amount utilized from the fund's assets for administrative and other operating charges. The expense ratio is charged annually depending upon the value of the fund.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
Tax benefit is subject to changes in tax laws
++Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

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