Equity offers high long-term returns but can be volatile in the short term. Debt is stable but lacks inflation-beating gains. If we leave out the ultra-aggressives and the ultra-conservatives, then for everyone else, a balanced mix of both is ideal. And this is where Aggressive Hybrid Funds are positioned. As per SEBI definitions, these need to have 65-80% in equity and 20-35% in debt. So, a single fund can give exposure to two different assets but with a higher weightage to equity, making it suited for medium-long term goals.
My views on why Aggressive Hybrid Funds can be useful for many investors’ core portfolio, were published in a column in Economic Times Wealth (Edition 15-21 September 2025). You can read the same via this link or in the image below:
