Hybrid Fund Categories
Balanced Advantage / Dynamic Asset Allocation Funds
Equity exposure moves with market valuations.
Updated 30 September 2026 · SEBI rules as of 2026
SEBI mandate
Dynamic 0–100% equity/debt
Hybrid Fund CategoriesOverview
BAFs shift between equity and debt (0–100%) using valuation models — buying more equity when markets are cheap and less when expensive. Most use arbitrage to retain equity taxation.
| Particular | Details |
|---|---|
| SEBI mandate | Dynamic 0–100% equity/debt |
| Tax treatment | Usually equity (via arbitrage) |
| Suited for | Conservative equity investors; 3–5 year goals |
What to check
| Parameter | Why |
|---|---|
| Equity range | Actual equity exposure over time |
| Debt quality | Credit profile of debt portion |
| Drawdowns | Fall during market corrections |
| Expense ratio | Direct vs regular |
| Rebalancing | Automatic asset allocation benefit |
Plan your investment
Frequently asked questions
Are hybrid funds safer than equity funds?
Usually less volatile, but they still carry market risk in the equity portion.
Mutual fund investments are subject to market risks; read all scheme-related documents carefully. Information is educational and may change with SEBI / tax rules — verify with the AMC, AMFI or SEBI. FinancePortal is not an investment adviser.