What are Aggressive Hybrid Funds?
Aggressive hybrid funds are open-ended hybrid schemes investing predominantly in equity and equity-related instruments with smaller allocation to debt and money market instruments. According to the SEBI guidelines, aggressive hybrid funds have to invest at least 65-80% of their total assets in equity and equity related instruments and 20-35% in debt instruments.
Why Invest in Aggressive Hybrid Funds?
- Provides the advantage of capital appreciation with lower volatility
- Provides a balanced risk-return mix through active diversification across asset debt and equity classes within the specified asset allocation range
- Equity portfolio enhances the returns of the overall fund portfolio while the debt portfolio limits the downside risk and generates stable returns
- Provides an alternative to investing separately in mutual funds belonging to various asset classes
- Reduces the churning cost incurred in managing separate equity and debt funds for asset allocation strategy
- Eliminates the need of market timing for implementing asset allocation strategy
- Benefits by booking profits in equity portfolios during rising equity markets and by increasing equity allocation during falling markets
- Provides higher tax efficiency than manual rebalancing of equity and debt fund exposure done by the investor themselves.
Also Read: Best Balanced Advantage Funds
Table of Best Aggressive Hybrid Funds
| Fund Name | Returns (%) | |||
| 1 year | 3 year | 5 year | 10 year | |
| JM Aggressive Hybrid Fund | -1.09 | 20.49 | 21.54 | 12.69 |
| Bank of India Mid & Small Cap Equity & Debt Fund | 2.07 | 19.75 | 22.72 | – |
| ICICI Prudential Equity & Debt Fund | 9.79 | 19.50 | 26.64 | 16.07 |
| Edelweiss Aggressive Hybrid Fund | 6.80 | 17.41 | 20.02 | 12.81 |
| Mahindra Manulife Aggressive Hybrid Fund | 6.56 | 17.10 | 19.97 | – |
| UTI Aggressive Hybrid Fund | 3.96 | 16.65 | 20.22 | 12.46 |
| DSP Aggressive Hybrid Fund | 5.68 | 16.49 | 16.99 | 12.70 |
| Invesco India Aggressive Hybrid Fund | 2.78 | 16.37 | 15.94 | – |
| Bandhan Aggressive Hybrid Fund | 10.86 | 16.18 | 18.35 | – |
| HSBC Aggressive Hybrid Fund | 6.69 | 16.13 | 16.00 | 11.34 |
Data as on October 30, 2025
Risks of Investing in Aggressive Hybrid Funds
- Risk profile is positioned between that of pure equity funds and pure debt funds as aggressive hybrid funds have a larger allocation towards equity and a small exposure to debt
- Exposed to interest rate risk, credit risk, liquidity risk or reinvestment risk faced by the debt funds or other instruments in the fixed income asset class
- Exposed to usual market risks and risk of capital erosion risks faced by equity funds
Who Should Invest in Aggressive Hybrid Funds?
- Investors with investment horizon of 3+ years
- Those seeking to participate in growth potential of equity markets with reduced downside risk
- Those seeking long term capital appreciation along with accrual income
- Those seeking long term capital appreciation with lower volatility than in equity funds
- Those seeking to benefit from both equity and debt across market cycles
- Those seeking automatic asset allocation through a single mutual fund scheme