GIVEN THE FACT that the benchmark Nifty has risen over 14% from its mid-June low, investors should be cautious as a potential peak could be just around the corner. They can now look at aggressive hybrid funds to make the most of the equity market opportunity and keep a smaller percentage of exposure to fixed income in case of severe market volatility.
As the risk in such funds is lower compared to pure equity funds, they are suitable for those who do not want to take too much market-related risks. Experts suggest aggressive hybrid funds can be used for financial goals which would come within five to seven years.
Equity, debt mix
In aggressive hybrid funds, asset management companies invest up to 80% of the portfolio in equities and the rest in debt. This helps the investor in asset allocation and diversify the assets across equity and debt. At the time of market volatility, fund managers rebalance the asset allocations to generate higher risk-adjusted returns.
This story is from the August 08, 2022 edition of Financial Express Mumbai.
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This story is from the August 08, 2022 edition of Financial Express Mumbai.
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