How equity-heavy investors can start using hybrid mutual funds in 2026

Hybrid mutual funds combine equity and debt in a single scheme, making them useful for investors who want to reduce risk without fully exiting equities. For someone holding an all-equity portfolio with high risk appetite, a gradual shift into aggressive hybrid funds can add stability. Allocating 20–30% to select aggressive hybrid schemes and keeping 70–80% in diversified equity funds can balance drawdowns while still participating in potential upside.