What is a balanced mutual fund and how to invest in a balanced mutual fund?
Balanced mutual funds also known as Hybrid funds are mutual funds in which the investor own both stocks and bonds. A balanced mutual fund is mainly introduced to balance the risk and reward ratio. In a long run, the investor can receive returns from both the invested bonds and stock.
How to choose the best balanced mutual fund?
Balanced mutual funds balances the risk-reward ratio by investing in stocks and bonds. The best way to ensure the return is to invest 60% on the stocks and 40% on bonds. Some people may prefer to invest up to 70% on the stocks and the remaining on the bonds. It all depends on the individual. This is the best option for you if you are investing for the first time and want to go with a low-risk profile. Balanced mutual funds are invested in a combination of stocks and bonds so it is less volatile than investing everything on the stocks. Below are some of the best balanced mutual funds currently available
SBI equity Hybrid Fund
The objective of the SBI equity fund is to provide the investors with the highest possible liquidity and long-term capital by investing in equity and debt. SBI equity Hybrid fund is an aggressive scheme. It invests about 60 to 80% in equity and 20 to 40% in debt. According to Crisil ranks, SBI equity Hybrid fund is placed 3rd in the aggressive hybrid fund. The point to be noted here is that since this fund invests a bigger part of the investment in equity, you may suffer losses during a market fall. SBI equity Hybrid Fund has an expense ratio of 1.25 and the first investment/Minimum investment for this fund is 1000 rupees.
HDFC Balanced Fund
The objective of this scheme is to generate income using the combined portfolio of both equity and debt. HDFC Balanced Fund invests 60% in equity and the remaining in debt. HDFC Balanced fund generated 18% annual return in 2017 and 20% annual return in previous 5 years. According to Crisil ranking, HDFC Balanced Fund is a good scheme and is in 3rd rank.
L&T Hybrid equity Fund
L&T Hybrid equity fund is in Crisil rank 3. According to the available statistics, the scheme performed well from last 5 years and managed to generate 16.57% returns in 2017. The scheme was launched in 2011 and it is doing well since. The minimum investment for the scheme is 5000 rupees. Check out the following site https://www.medicaresupplementplans2019.com/aarp-medicare-supplement-plans-2019/AARP Medicare supplement Plans 2019 for AARP medicare supplement plans
ICICI Prudential Equity and Debt Fund
ICICI Prudential Equity and Debt Fund was launched on Nov 03, 1999. It is a scheme with moderately high risk but above average returns. Minimum investment for the scheme is 5000 rupees. The scheme is doing well since many years. It generated 15.81% returns in the last 5 years and 16.69 returns in the last 10 years.