HSBC Arbitrage Fund - Direct - Dividend

What are Hybrid Mutual funds?

Hybrid mutual funds, also known as balanced funds, are investment funds that combine two or more asset classes, such as stocks, bonds, and cash, in a single portfolio. The purpose of a hybrid fund is to provide investors with a diversified investment option that balances the risks and rewards of different asset classes.

Hybrid mutual funds can be categorized into three main types based on their asset allocation:

1. Conservative Hybrid Funds: These funds invest a larger portion of their portfolio in fixed income securities such as bonds and money market instruments, and a smaller portion in equity securities. They are suitable for investors who prefer stability and income over growth.

2. Balanced Hybrid Funds: These funds maintain a balanced mix of equity and fixed income securities in their portfolio. They are suitable for investors who want to balance the potential for growth with some measure of stability.

3. Aggressive Hybrid Funds: These funds invest a larger portion of their portfolio in equity securities, and a smaller portion in fixed income securities. They are suitable for investors who are willing to take on higher levels of risk in pursuit of potentially higher returns.

Hybrid mutual funds are a popular investment option for investors who want to diversify their portfolio and reduce their risk exposure. They can be a suitable option for both conservative and aggressive investors, depending on the specific type of hybrid fund and its asset allocation.