Fund categories, explained
Conservative hybrid funds
mostly bonds, a little in shares.
A conservative hybrid fund keeps most of its money in bonds and a small part, a tenth to a quarter, in shares. It aims to do a little better than a debt fund, with a little more movement.
0.0% over the past year
The typical (median) return of 17 regular-plan funds, all fund houses
- Typical, 3 years
- 6.8% a year
- Typical, 5 years
- 6.3% a year
- Funds counted
- 17
The basics
What is a conservative hybrid fund?
Invests 10% to 25% in equity and equity-related instruments, and 75% to 90% in debt.SEBI’s definition of the category
What it holds
- Government and company bonds, for 75% to 90% of the fund
- Shares, for 10% to 25%
Who it can suit
- Retirees wanting a steadier part of the plan that can still grow a little
- Money for three years or more, where small falls can be lived with
Comes up most in Retirement Income
Side by side
Conservative hybrid funds or an FD?
Neither is better in general. It depends on when you need the money and what you can live with along the way.
| Compare | Conservative hybrid fund | Fixed deposit |
|---|---|---|
| Return | Varies with bonds and shares | Fixed for the term |
| Tax | Only when you sell, at your slab rate | Interest taxed every year, at your slab rate |
| Its value | Can fall, usually by a little | Doesn’t fall |
| Safety | Not guaranteed or insured | Insured up to ₹5 lakh per bank (DICGC) |
Before you invest
Risks, tax and getting your money out.
The risks, plainly
- The share portion can pull it down in a bad year for markets.
- Bond prices fall when interest rates rise, and a borrower defaulting can reduce value.
- Each scheme shows its riskometer and Potential Risk Class; check both before you invest.
How it’s taxed
With most of the fund in bonds, gains are taxed at your income-tax slab rate when you sell, like a debt fund. Nothing is taxed while you hold the units.
Tax rules change with budgets. We go through the current position with you and your CA.
Getting your money out
- Redemptions usually reach your bank within two or three business days.
- Many charge an exit load if you sell within a year; it varies by scheme.
Typical returns
What the category has returned.
The median return of every conservative hybrid fund's regular plan, across all fund houses, from AMFI’s published NAVs as of 30 October 2026. Half the funds did better, half did worse.
Over 1 year
0.0%
Median of 17 funds
Over 3 years, a year
6.8%
Median of 17 funds
Over 5 years, a year
6.3%
Median of 16 funds
Regular plans, growth option, which include the distributor’s commission. Returns over a year are yearly averages (CAGR). Past returns of a category, not a recommendation of any scheme: past performance may or may not be sustained in future, and what suits you depends on your goals and a suitability check. Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
FAQs
Your questions about conservative hybrid funds.
What is a conservative hybrid fund?
Is it good for retirees?
How are conservative hybrid funds taxed?
Can I take a monthly income from one?
Conservative hybrid fund or FD?
Is a conservative hybrid fund safe?
Fund categories
Compare it with similar categories.
New to mutual funds? Mutual funds, explained
Your next step
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