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Hybrid Funds Tipped to Outshine in 2025 as Investors Seek Stability
20 Aug
Summary
- Conservative hybrid funds invest 75-90% in debt, 10-25% in stocks
- Advisors recommend hybrid funds for new and inexperienced investors
- Hybrid funds offer a balance of equity exposure and debt security
According to financial experts, 2025 is poised to be the year of hybrid mutual funds as investors navigate an uncertain global economic landscape and a volatile Indian stock market. Conservative hybrid funds, which invest 75-90% in debt instruments and 10-25% in equities, are emerging as a popular choice for both new and experienced investors.
These hybrid schemes offer a balanced approach, providing exposure to the stock market while maintaining a strong debt portfolio to mitigate risk. Advisors believe that in the current climate, hybrid funds can serve investors better than traditional investment options. Unlike the now-defunct monthly income plans (MIPs), hybrid funds do not promise regular dividends, but rather aim to generate moderate returns through a mix of debt and equity.
For those seeking a ready-made solution to gain a small equity exposure, conservative hybrid funds present a viable option. However, it is crucial to remember that stocks, even in a hybrid portfolio, carry inherent risks and do not guarantee assured returns year-over-year. Investors, especially those new to the market, should exercise caution and understand the potential for both gains and losses when investing in these schemes.
