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Best TATA Hybrid Mutual Funds

Tata Mutual Fund was incorporated in 1994 to provide individuals with investment solutions that would help them in financial planning and wealth creation. It is a part of the TATA Group.

TATA Sons Limited owns 67.91% shares of this company; whereas TATA Investment Corporation Limited holds the remaining 32.09% shares. For the quarter ending March 2021, this asset management company (AMC) has a quarterly AUM of approximately Rs.61,684 crore. Its product offerings include a diverse class of funds that enable investors to allocate their savings to various schemes based on their financial goal and risk profile. In total, it has over 150 schemes, which include the best TATA hybrid mutual funds

A hybrid fund invests in more than one asset classes, primarily debt and equity.  The asset allocation percentage is decided by the fund manager of a scheme who buys and sells the underlying securities to achieve the objective of a scheme in varying market conditions. 

According to the Securities and Exchange Board of India (SEBI) rules, equity-oriented hybrid funds must allocate at least 60% of the fund corpus to stocks. In contrast, the portfolio of debt-oriented funds must largely comprise fixed-income securities. The primary objective of top TATA hybrid mutual funds is to build a diversified portfolio, which reduces concentration risk. By creating a prudent mix, hybrid funds have the ability to generate higher returns than debt schemes without being as risky as pure equity funds. 

Equity-oriented and debt-oriented hybrid funds are further categorised into six types: Conservative hybrid fund, aggressive hybrid fund, balanced hybrid fund, dynamic asset allocation or balanced advantage fund, equity savings, arbitrage fund, and multi-asset allocation fund. 

TATA Mutual Fund has more than 25 hybrid schemes.

Taxability

The returns earned on these funds are taxed depending on whether they are equity-oriented or debt-oriented funds. 

Short-term Capital Gains Tax: For equity-based schemes, short-term capital gains are taxed at 15%. Whereas, in the case of debt-oriented funds, such gains are added to an investor’s taxable income and taxed as per his/her slab rate. 

Long-term Capital Gains Tax: If the long-term capital gains of equity-based hybrid funds are up to Rs.1 lakh, such returns are tax-free. The amount exceeding Rs.1 lakh is taxed at 10%. However, in the case of debt-oriented hybrid funds, a tax rate of 20% is applicable on long-term capital gains. Furthermore, investors are eligible for indexation benefits. 

Factors to Consider Before Investing

When choosing the best TATA hybrid mutual funds, it’s imperative for investors to consider certain aspects. They are discussed in detail below:

Investment goal: The returns generated by an aggressive equity-oriented mutual fund scheme will be more impacted in a bearish market when compared with a debt-based hybrid fund. The underlying debt instruments will provide stability to investors in unfavourable market conditions. However, the former may outperform the latter and generate higher returns when markets are favourable. Hence, it’s key for investors to identify their financial goals before investing in any of the best TATA hybrid mutual funds in 2022

Exit load: Exit load is a penalty that a fund house levies on investors if they choose to redeem their units, fully or partially, within a pre-specified period from the date of purchase. The main purpose of this charge is to discourage investors from withdrawing from a scheme prematurely. The best TATA hybrid mutual funds have different exit loads. One must make sure to know what they are before parking their funds. 

Expense ratio: The expense ratio is an fee that a fund house charges investors to cover the expenses incurred for financing the operating and administrative expenses of a fund. It includes marketing expenses, allocation charges, the salary of fund managers, etc.  The expense ratio is calculated as a small percentage of a fund’s overall assets. Hence, it’s crucial for one to compare the expense ratios of the best TATA hybrid mutual funds before they make a decision. 

Experience of the fund manager: Managing the portfolio of a hybrid mutual fund scheme is extremely complicated. Fund managers have to vary the equity-debt mix based on the current market scenario. Moreover, they have to adhere to the asset allocation limits set by SEBI. They have to take judicious buy-and-sell decisions at the right time based on research, analysis, and advanced risk and liquidity management techniques. This is where the experience of a fund manager comes into play. Someone with a proven track record has the potential to achieve the predetermined objective of the best TATA hybrid mutual funds.

Direct/regular plan: To opt for a regular plan, investors have to make the transaction via a third party, such as a broker or a distributor. However, no such third party is involved in the case of direct plans. Investors can subscribe to it directly. That’s why direct plans report higher NAVs and even have a lower expense ratio. 

Risk appetite: Equity-based hybrid funds are riskier in comparison to debt-oriented schemes as they primarily invest in stocks. The performance of even the best TATA hybrid mutual fund is impacted owing to volatile market conditions. Hence, one must assess his/her risk appetite before parting with their savings. That said, one must note that even debt-based schemes are associated with risks like credit risk, interest rate risk, inflation risk, etc. 

SIP/Lump sum: Investors can allocate their funds to a hybrid mutual fund scheme via either one of the two investment routes – Systematic investment plan (SIP) and lump sum. The first option allows investors to invest by paying fixed instalments on a monthly, quarterly, or yearly basis. Nevertheless, the lump sum route allows them to invest the entire amount available with them in the best TATA hybrid mutual funds at one go.

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List of Tata Mutual Funds in India

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
Tata Digital India FundEquityVery High2.2%₹5,512
Tata India Consumer FundEquityVery High1.3%2₹1,270
Tata Equity PE FundEquityVery High3.8%3₹4,847
Tata Ethical FundEquityVery High1.9%₹1,250
Tata Income FundDebtModerate0.5%3₹50
Tata Banking and Financial Services FundEquityVery High-7.7%4₹962
Tata India Tax Savings FundEquityVery High3.1%3₹2,905
Tata Money Market FundDebtModerate3.9%5₹8,491
Tata Hybrid Equity FundHybridVery High2.7%2₹3,095
Tata Flexi Cap FundEquityVery High-0.8%3₹2,079
Tata Retirement Savings FundSolution OrientedVery High-1.5%3₹1,531
Tata India Pharma & HealthCare FundEquityVery High-6.0%₹508
Tata Retirement Savings FundSolution OrientedVery High-3.6%3₹1,170
Tata Index Sensex FundOtherVery High0.8%4₹138
Tata Liquid FundDebtLow to Moderate3.6%3₹12,455
View All

Let's have a closer look

Now let us jump and check about these top 10 mutual fund schemes.

Tata Digital India Fund Direct Growth

Fund Performance: The Tata Digital India Fund has given 27.34% annualized returns in the past three years and 28.24% in the last 5 years. The Tata Digital India Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Digital India Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹5,512Cr
1Y Returns2.2%

Tata India Consumer Fund Direct Growth

Fund Performance: The Tata India Consumer Fund has given 14.06% annualized returns in the past three years and 12.34% in the last 5 years. The Tata India Consumer Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata India Consumer Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹1,270Cr
1Y Returns1.3%

Tata Equity PE Fund Direct Growth

Fund Performance: The Tata Equity PE Fund has given 11.96% annualized returns in the past three years and 9.44% in the last 5 years. The Tata Equity PE Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Equity PE Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹4,847Cr
1Y Returns3.8%

Tata Ethical Direct Plan Growth

Fund Performance: The Tata Ethical Fund has given 18.66% annualized returns in the past three years and 13.51% in the last 5 years. The Tata Ethical Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Ethical Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹1,250Cr
1Y Returns1.9%

Tata Income Fund Direct Growth

Fund Performance: The Tata Income Fund has given 6.12% annualized returns in the past three years and 5.7% in the last 5 years. The Tata Income Fund belongs to the Debt category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Income Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹50Cr
1Y Returns0.5%

Tata Banking and Financial Services Fund Direct Growth

Fund Performance: The Tata Banking and Financial Services Fund has given 5.87% annualized returns in the past three years and 8.65% in the last 5 years. The Tata Banking and Financial Services Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Banking and Financial Services Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹962Cr
1Y Returns-7.7%

Tata India Tax Savings Fund Direct Growth

Fund Performance: The Tata India Tax Savings Fund has given 12.01% annualized returns in the past three years and 11.3% in the last 5 years. The Tata India Tax Savings Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata India Tax Savings Fund via lump sum is ₹500 and via SIP is ₹500.

Min Investment Amt₹500
AUM₹2,905Cr
1Y Returns3.1%

Tata Money Market Fund Direct Growth

Fund Performance: The Tata Money Market Fund has given 5.45% annualized returns in the past three years and 4.8% in the last 5 years. The Tata Money Market Fund belongs to the Debt category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Money Market Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹8,491Cr
1Y Returns3.9%

Tata Hybrid Equity Fund Direct Plan Growth

Fund Performance: The Tata Hybrid Equity Fund has given 10.53% annualized returns in the past three years and 8.71% in the last 5 years. The Tata Hybrid Equity Fund belongs to the Hybrid category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Hybrid Equity Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹3,095Cr
1Y Returns2.7%

Tata Flexi Cap Fund Direct Growth

Fund Performance: The Tata Flexi Cap Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Flexi Cap Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹2,079Cr
1Y Returns-0.8%

Tata Retirement Savings Fund Moderate Plan Direct Growth

Fund Performance: The Tata Retirement Savings Fund has given 10.96% annualized returns in the past three years and 9.6% in the last 5 years. The Tata Retirement Savings Fund belongs to the Solution Oriented category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Retirement Savings Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹1,531Cr
1Y Returns-1.5%

Tata India Pharma & HealthCare Fund Direct Growth

Fund Performance: The Tata India Pharma & HealthCare Fund has given 23.7% annualized returns in the past three years and 14.16% in the last 5 years. The Tata India Pharma & HealthCare Fund belongs to the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata India Pharma & HealthCare Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹508Cr
1Y Returns-6.0%

Tata Retirement Savings Fund Progressive Plan Direct Growth

Fund Performance: The Tata Retirement Savings Fund has given 10.82% annualized returns in the past three years and 10.17% in the last 5 years. The Tata Retirement Savings Fund belongs to the Solution Oriented category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Retirement Savings Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹1,170Cr
1Y Returns-3.6%

Tata Index Sensex Direct

Fund Performance: The Tata Index Sensex Fund has given 11.26% annualized returns in the past three years and 11.96% in the last 5 years. The Tata Index Sensex Fund belongs to the Other category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Index Sensex Fund via lump sum is ₹5,000 and via SIP is ₹150.

Min Investment Amt₹5,000
AUM₹138Cr
1Y Returns0.8%

Tata Liquid Fund Direct Growth

Fund Performance: The Tata Liquid Fund has given 4.23% annualized returns in the past three years and 5.44% in the last 5 years. The Tata Liquid Fund belongs to the Debt category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Liquid Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹12,455Cr
1Y Returns3.6%

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