Market conditions over the next year are expected to remain uncertain. Many experts believe investors should stay cautious and avoid taking extreme risks. This is where hybrid mutual funds come into the picture.
These funds invest in both shares and fixed-income instruments, which helps balance growth and safety during volatile times.
Among hybrid funds, aggressive hybrid schemes are quite popular. They mainly invest in equities but also hold a portion in debt. As per SEBI rules, these funds must invest 65-80 per cent in stocks and 20–35 per cent in debt. This mix helps reduce sharp ups and downs. When stock markets fall, the debt portion helps limit losses, making it easier for investors to stay invested.
Aggressive hybrid funds are often suggested to investors who want equity growth but are not comfortable with too much volatility. These investors are open to risk but prefer some stability along the way.
Who Should Consider These Funds
A conservative equity investor is different from a fully conservative investor. Conservative investors usually avoid stocks and prefer fixed deposits or bonds. Conservative equity investors, on the other hand, invest in stocks but want smoother returns over time. Aggressive hybrid funds suit this group well, as they offer exposure to equities with some downside support.
How The Mixed Portfolio Helps
One key benefit of these funds is regular portfolio balancing. When stock prices rise sharply, the equity portion may exceed the planned limit. Fund managers then sell some stocks and shift money to debt. This profit booking over time can improve returns and control risk.
Doing this on your own may lead to tax costs when gains cross Rs 1 lakh in a year. Mutual funds do not pay tax while rebalancing, which helps investors retain more returns.
Points to Keep in Mind Before Investing
These funds help reduce volatility and support long-term wealth creation. Regular profit booking and tax efficiency add to their appeal. However, they are not meant to provide a steady income through dividends. Also, since at least 65 per cent is invested in stocks, they are not risk-free. Short-term ups and downs should be expected.
Recent Performance Update
Some schemes have seen changes in rankings over recent months. SBI Equity Hybrid Fund has moved to the third quartile after being in the fourth earlier. Mirae Asset Aggressive Hybrid Fund has stayed in the third quartile for the last eight months. Canara Robeco Equity Hybrid Fund has been in the third quartile for over two years.
These funds were also part of earlier recommendation lists and continue to be tracked closely.
Aggressive Hybrid Schemes To Consider In December 2025
SBI Equity Hybrid Fund
Canara Robeco Equity Hybrid Fund
Mirae Asset Aggressive Hybrid Fund
ICICI Prudential Equity and Debt Fund
Quant Aggressive Hybrid Fund
How These Funds Were Shortlisted
The selection is based on long-term returns, consistency, downside risk, performance versus benchmarks, and minimum asset size. These factors help identify funds that balance risk and returns better over time.
