Balanced Mutual Funds – Types and Best Balanced Funds


Balanced Mutual funds are a viable option for investors who loves to get high return with manageable risk. High returns here mentioned here is in comparison with fixed deposits or other money market mutual funds.

The mutual funds market capital of India has crossed 37.56 Trillion INR as of 28th February, 2022. Mutual funds in India is penetrating in every house holds, as 70% of retail investors are with annual income of less than 5 lakhs.

Many Fund House (Asset managing Company) has launched multiple types of balanced mutual funds since 2013.

In this article, you will be learning the phases like,

  • What is Balanced Mutual Funds?
  • Types of Balanced Mutual Funds
  • Best Balanced Funds
  • Risk Analysis of Balanced Mutual Funds
  • Who should invest in Balanced Mutual Funds?, and many more.

What is Balanced Mutual Funds?

A Balanced Mutual Funds is a type of mutual funds in India. This type of fund invest on the securities like equities, bonds, and cash market. The asset allocation of this fund resembles like 70% in equity and 30% in bonds.

Balanced funds are also known as Hybrid funds.

Equity are stocks of public companies that are traded in secondary market of stock exchanges. These companies share prices tends to grow high as the earning and profit hikes up.

Yet, these securities are clubbed with risks, that could shrink your investment principles.

Bonds are usually the debt instrument from Government, corporate companies, PSU banks, etc.

These bonds tends to yield a better return than fixed deposit, and the income are very stable, and associated with low risk,

Types of Balanced Mutual Funds?

These funds are chosen by investors to minimize market risk. Hybrid funds are highly diversified as it holds both equity and debt in the majority.

Balanced funds or Hybrid funds are seven types,

1. Conservative Hybrid Fund – 10% to 25% in equity; 75% to 90% in debt.

2. Balanced Hybrid Fund – 40% to 60% in equity; 60% to 40% in debt.

3. Aggressive Hybrid Fund – 65% to 80% in equity; 35% to 20% in debt.

4. Balanced Advantage Fund – Equity or debt are managed dynamically.

5. Multi Asset Allocation – Investments in three allocations of a minimum of 10% each.

6. Arbitrage Fund – Minimum 65% of investment in Equity.

7. Equity Savings – Minimum 65% in Equity and Minimum 10% in Debt.