I invest in both debt funds and equity funds. Are there any funds that invest in both equity and debt instruments?Asked
There are various categories of mutual funds in India:
If you are looking for funds that invest in both bonds and in stocks you should look at Hybrid mutual funds. All mutual funds keep a mix of debt and equity in their portfolio depending on the fund type. For example, an equity fund may invest 80%-85% of its portfolio in equity and the remaining part in debt and similarly debt funds may invest 80%-85% in bonds and remaining part in equity.
But hybrid funds are funds which invest a considerable proportion in both debt and equity. The hybrid funds also known as the balanced funds, in general maintain allocation of more than 65% of the NAV in equity shares. This helps them to maintain tax status as equity oriented funds with incidental tax benefits to investors.
The objective of these funds is to achieve growth by investing in equity and equity related investments, balanced with income generation by investing in debt and money market instruments.
These funds are for people who are willing to take moderate risk, duration of investment is 2-4 years and want to benefit from both equity and debt. Returns in these funds are usually between 12-15%.
All big mutual fund houses have hybrid funds, you can check the details of the funds by clicking here
Some of the top performing balanced funds as per Groww rating are:
Yes, balanced mutual funds are the funds which invest in both stocks and bonds. They are designed by the fund managers to handle the risk diversification of investors. These funds are also called hybrid funds.
Top performing balanced funds: