Hybrid mutual fund invests in both debt and equity instruments to achieve diversification and avoid concentration risk. This mutual fund depends on the risk preferences of the investors and investment objectives.
Types: Equity-oriented hybrid funds, Debt-oriented balanced funds, Arbitrage Funds, and Monthly Income Plans.
Benefits: The hybrid mutual funds are completely risk-free but it does not offer guaranteed offers. This mutual fund has a low expense ratio as compared to the other mutual funds.