Hybrid Mutual Funds
Mutual Fund Disributors in Mumbai
Planning to invest in mutual funds? Let Fund Pinnacle make the journey easy for you
Mutual funds are an investment vehicle where people invest their money, which is further invested by a team of professional money managers in different investment products – stocks, bonds, for instance. MFs help investors diversify their portfolios and manage their funds more professionally.
Why need help of
Mutual fund consultant in Mumbai
Small investors can invest in Mutual Funds on their own without any significant advantages or disadvantages. But taking the help of professional mutual fund agents in Mumbai can help them invest on a surer and more confident footing. They can also benefit from the expertise and experiences of professional investment service providers.
Mutual Funds are an ideal investment option for those who low risk appetite. Mutual funds are basically of three types:
Equity mutual funds
Debt mutual funds
Hybrid mutual funds
Why invest in mutual funds?
The reasons why an investor should buy mutual funds in place of stocks are many but diversification of investment portfolio, ease, and lower costs are significant ones. Actively managed funds need a portfolio manager who regularly updates their holdings, while a not-so-actively managed fund's portfolio relies on a buy-hold-sell strategy.
Hybrid funds come in all shapes and sizes and are categorised into Equity Fund, Balanced Advantage Fund, Aggressive Hybrid Fund, and Conservative Hybrid Fund.
Hybrid funds are also classified on the percentage allocated to equity which might vary from 20% to 80%. All these details may confuse the investors. Here comes in the picture professional Mutual fund distributors in Mumbai who can provide you with well-thought and prudent advice.
Let us now discuss hybrid mutual funds in detail.
They invest in across asset classes
Hybrid funds work on the principle of asset allocation. Simply speaking, these funds invest in a combination of asset classes like equity, debt, gold, and even international ETFs. This allows investors to reap the benefits of any upside on account of the equity exposure and protect the downside by parking some portion of the surplus into debt instruments as well.
How investments in different assets help
The different assets often have a negative correlation which not just helps with portfolio diversification but also improves the risk-reward ratio. Here’s why?
Asset classes go through cycles and often a different asset class emerges on top of the performance chart. For instance, in 2015, the BSE Sensex posted a return of negative 5% while debt returned positive 8.5%. But in 2017, the same BSE Sensex recorded a positive return of 28% while the debt index could only manage a return of 6%. This highs and lows cycle often continues across asset classes almost every year.
Confusing? Take help of Mutual fund distributors in Thane
Such complexities and handpicking of asset classes can be a tough task for individual investors as most of them neither have the knowledge nor the time to manage the investments efficiently, especially in a financial hub like Mumbai. Mutual fund distributors in Mumbai and Thane can provide the investors with beneficial bits of advice.
Categories of Hybrid Funds
There are three main hybrid funds – conservative, balanced, and hybrid
Conservative hybrid fund
Aggressive hybrid fund
Balanced hybrid fund
During and after the COVID-19 induced lockdown, a large number of Demat accounts were opened and first-time investors rushed to buy shares without understanding much of what they were up to. Lack of knowledge and discipline is bad in investment. Therefore, investors should seek professional advice from mutual fund distributors in Thane.
Investors should look into the different categories of hybrid funds on the basis of their risk profile, investible wealth, lock-in period, and a few other parameters. Consulting a mutual fund distributor in Thane or Mumbai would be a wiser decision as hybrid funds also contain an element of risk associated with equity funds. Hybrid funds do an excellent job and are a balancing act. It can prove to be a vital addition to your investment portfolio, especially if you are new to investing and generally conservative or moderate in your risk outlook.