What are hybrid funds? Are they different from balanced funds?

What are hybrid funds? Are they different from balanced funds?

Ajay Garg, Delhi

The two are many a times used inter changeably because both have a combination of equity and debt allocation in them. However, depending upon the allocation between these two asset classes, such funds are classified into two types — equity oriented hybrid funds and debt oriented hybrid funds. Balanced fund is a type of equity fund wherein the equity allocation can be between 65-80 per cent of the portfolio. Hybrid funds are suitable for investors with a moderate risk profile as the portfolio is constructed keeping in mind the conservative risk profile of investors.

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