Shivani Verma | Jan 21, 2025 |
Top Conservative Hybrid Mutual Funds for Investment in January 2025
A conservative hybrid fund is a type of mutual funds that provide higher returns with lower risk. It focuses on preserving capital and generating income while minimizing risk. Most of the mutual fund experts think that 2025 is going to be a great year for hybrid mutual funds. Because of the global economy and the continuously rising Indian stock market, mutual funds experts suggest that investors proceed with caution. In this situation, they suggest to invest in hybrid mutual funds.
Conservative hybrid mutual funds are the easy way to start investing in hybrid funds. These funds mainly invest in debt like: loans or bonds and a smaller percent in stocks. According to SEBI rules, they must invest 75-90% in debt and 10-25% in stocks. These funds are great for those investors who want to put a small part of their corpus into stocks to earn higher returns.
These schemes are related to the old Monthly Income Plans (MIPs), which were very popular in the past. MIPs used to invest a small part of their money in stocks, and their USP was providing regular income through dividends. However, when the market went through a bad phase, the dividends stopped, and MIPs lost their appeal. The takeaway is that you should not rely on hybrid funds for a steady income.
If you want a regular income, it is better to choose a SWP (Systematic Withdrawal Plan). But you should be careful not to withdraw too much if you want to keep your original investment safe. If you want to protect your capital you should always withdraw less than the amount your investment earns.
If an investor is looking for a ready-made scheme to start investing with a small amount, they can consider investing in conservative hybrid schemes. But before investing remember, especially if you are new to investing in stocks, they come with some risks. Stocks don’t always give guaranteed returns and can lose value at the time of market downturn. In simple terms, investing in stocks involves taking a risk, even if it’s just 25% of your total investment.
Top conservative hybrid funds for investment in January 2025:
From these top conservative hybrid funds, Canara Robeco Conservative Hybrid Fund has been in the top third quartile for the last five months. before that, the scheme had been in the top fourth quartile.
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