Last Updated on August 30, 2021 at 8:05 am
Here are eight aggressive hybrid mutual funds that have consistently beaten CRISIL Hybrid 35+65 – Aggressive Index. We also discuss their downside protection consistency and performance against NIfty 100 TRI.
The index comprises of S&P BSE 200 TR(65%) and CRISIL Composite Bond Fund
Index (35%). The analysis was carried out for 33 aggressive hybrid funds, out of which 21 were more than five years old. The data for the study was sourced from Equity Mutual Fund Screener, April 2021 (this also evaluates aggressive hybrid funds against Nifty 100 TRI).
How the funds were selected
We consider every possible 1,2,3,4 and 5-year investment windows bet 1st Jan 2013 and April 6th 2021.
We shall define a, return outperformance consistency = no of times fund beat index/tot no returns. For example, say we have 100 13-year return data points and a fund got a return higher than the index in 65 of those instances. Then return outperformance consistency = 65/100 = 65%.
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We then define a downside protection consistency using the downside capture ratio. This measures how much of a benchmark’s monthly losses (if monthly return < 0) a fund captures. A downside of 80% means a fund has captured only 80% of the index losses. Read more: Do active mutual funds offer downside protection? Or is it a myth?
Downside protection consistency is defined as the number of investment periods for which the fund fell less than the index (suffered lower losses) divided by the total no of periods. This is computed for every possible 1,2,3,4 and 5-year windows.
To qualify as a “consistent performer” the fund should have a return outperformance consistency of 70%. In addition, we shall also consider downside protection consistency over 1,2,3,4 and 5 -year periods.
Eight Consistent Aggressive Hybrid Mutual Funds
The rolling return outperformance and downside protection consistencies for eight aggressive hybrid funds are shown below over five (table A), four (table B) and three (table C) years
Table A
| Fund | rolling return outperformance Consistency Score (5 years) | downside protection consistency (5 years) |
| Mirae Asset Hybrid-Equity Fund -Direct Plan-Growth | 100% | 50% |
| Canara Robeco Equity Hybrid Fund – Direct Plan-Growth | 100% | 98% |
| Principal Hybrid Equity Fund- Direct Plan-Growth Option | 100% | 93% |
| DSP Equity & Bond Fund – Direct Plan-Growth | 96% | 83% |
| HDFC Children’s Gift Fund Investment Plan-Direct Plan | 88% | 93% |
| SBI EQUITY HYBRID FUND – DIRECT PLAN – Growth | 87% | 80% |
| ICICI Prudential Equity & Debt Fund – Direct Plan-Growth | 76% | 83% |
| HDFC Hybrid Equity -Direct Plan-Growth Option | 72% | 93% |
Table B
| Fund | rolling return outperformance Consistency Score (4 years) | downside protection consistency (4 years) |
| Mirae Asset Hybrid-Equity Fund -Direct Plan-Growth | 100% | 41% |
| Canara Robeco Equity Hybrid Fund – Direct Plan-Growth | 99% | 71% |
| Principal Hybrid Equity Fund- Direct Plan-Growth Option | 93% | 83% |
| SBI EQUITY HYBRID FUND – DIRECT PLAN – Growth | 92% | 75% |
| DSP Equity & Bond Fund – Direct Plan-Growth | 87% | 73% |
| HDFC Children’s Gift Fund Investment Plan-Direct Plan | 86% | 71% |
| ICICI Prudential Equity & Debt Fund – Direct Plan-Growth | 76% | 87% |
| HDFC Hybrid Equity -Direct Plan-Growth Option | 71% | 88% |
Table C
| Fund | rolling return outperformance Consistency Score (3 years) | downside protection consistency (3 years) |
| Mirae Asset Hybrid-Equity Fund -Direct Plan-Growth | 100% | 62% |
| Canara Robeco Equity Hybrid Fund – Direct Plan-Growth | 97% | 64% |
| SBI EQUITY HYBRID FUND – DIRECT PLAN – Growth | 84% | 66% |
| Principal Hybrid Equity Fund- Direct Plan-Growth Option | 78% | 88% |
| HDFC Children’s Gift Fund Investment Plan-Direct Plan | 78% | 70% |
| ICICI Prudential Equity & Debt Fund – Direct Plan-Growth | 70% | 89% |
| HDFC Hybrid Equity -Direct Plan-Growth Option | 69% | 80% |
| DSP Equity & Bond Fund – Direct Plan-Growth | 68% | 56% |
As is evident from the tables, Mirae Hybrid is not a consistent downside performer – it often falls more than the benchmark. If you inspect the screener data, such funds typically are upside performers – they gain more than the benchmark.
We have included 68% and above rolling return consistency over three years (Table C). Narrow screening is not helpful for the investor. Some relaxation here and there is practically necessary.
Additional Resources
- Why Aggressive Hybrid (balanced) Mutual Funds score over diversified funds
- Using Balanced Mutual Funds As The Core Equity Portfolio Holding