Published Jul 20, 2026 4 Min Read

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In summary

If you are looking for aggressive hybrid mutual funds with strong recent performance, comparing their 3-year CAGR, expense ratio, AUM, and exit load can help you make a better investment decision. While past returns do not guarantee future performance, they offer insight into how funds have performed across different market conditions.

Key points:

  • Aggressive hybrid funds maintain 65–80% equity exposure and 20–35% debt exposure.
  • The aggressive hybrid category delivered an average 3-year CAGR of around 14.3% in 2026.
  • Bank of India Mid & Small Cap Equity & Debt Fund recorded the highest 3-year CAGR at 20.3%.
  • These funds are generally suitable for investors with a 3–5 year or longer investment horizon.

What are aggressive hybrid mutual funds?

Aggressive hybrid mutual funds are SEBI-regulated hybrid schemes that invest 65–80% of their portfolio in equities and 20–35% in debt instruments. The higher equity allocation aims to generate long-term capital appreciation, while the debt portion helps reduce overall portfolio volatility.

These funds are often chosen by investors who want better growth potential than traditional debt investments without taking the full risk of an equity fund. Like all mutual funds, they are managed by professional fund managers at their respective asset management companies (AMCs).

SEBI also requires every mutual fund scheme to display a Riskometer, helping investors understand whether a scheme falls under Low, Moderate, High, or Very High risk.

Which aggressive hybrid mutual funds delivered the highest 3-year returns in 2026?

Aggressive hybrid mutual funds are designed for investors who want equity-like growth while reducing some market volatility through debt investments. These schemes invest predominantly in equities while maintaining a debt allocation for stability.

One way to evaluate these funds is by comparing their 3-year compounded annual growth rate (CAGR). Although past performance does not predict future returns, it helps you understand how consistently a fund has performed over a market cycle.

Which are the top 5 aggressive hybrid mutual funds by 3-year CAGR in 2026?

The table below ranks five aggressive hybrid mutual funds based on their 3-year CAGR. Along with returns, it also compares each fund's NAV, assets under management (AUM), expense ratio, and exit load to give you a more complete picture.

RankFundNAV (Direct, Growth)AUMExpense RatioExit Load3-Yr CAGR3-Yr Absolute Return*
1Bank of India mid & small cap equity & Debt FundRs. 46.24   1,695.32 Cr0.63% 1% if redeemed within 0–3 months ~20.3% (3-yr return: 72.92%) ~72–74%
2ICICI prudential equity & debt fundRs. 456.93 as of 08 Jul 2026 50,032.71 Cr 0.78% 1% if redeemed within 0–1 year 16.69% ~58.9%
3Quant aggressive hybrid fundRs. 514.22 as of 19 Jun 2026 2,128 Cr 0.80% 1% if redeemed within 15 days 16.34% ~57.5%
4JM aggressive hybrid fundRs. 134.40 as of 28 Jun 2026 691.85 Cr 0.90% 1% if redeemed within 60 days 19.14% ~69.1%
5Bandhan aggressive hybrid fundRs. 31.21 as of 24 Jun 2026 1,919 Cr 0.50% 1% if units in excess of 10% are redeemed within 12 months 15.71% ~54.9%

Note: Data sourced as of July 2026. Past performance is not indicative of future returns.

How do these top aggressive hybrid mutual funds compare side by side?

Comparing funds side by side can help you evaluate not only returns but also factors such as fund size, costs, and exit conditions. While a higher CAGR may be attractive, it should always be assessed alongside the expense ratio, AUM, and your investment goals.

Fund3-Year CAGRAUMExpense RatioNAVExit Load
Bank of India Mid & Small Cap Equity & Debt Fund20.3%Rs. 1,554 crore0.87%Rs. 46.24 (Direct, 15 Jul 2026)1% if redeemed within 0–3 months of allotment
ICICI Prudential Equity & Debt Fund16.7%Rs. 50,032 crore1.05%Rs. 456.93 (Direct, 08 Jul 2026)Nil on up to 30% of units within 1 year; 1% on the remainder if redeemed within 1 year; nil after 1 year
Quant Aggressive Hybrid Fund16.1%Rs. 2,127 crore1.36%Rs. 514.22 (Direct, 19 Jun 2026 — latest figure available)1% if redeemed within 15 days of allotment
JM Aggressive Hybrid Fund15.79%Rs.692.05 crore1.09%Rs. 136.45 (Direct, 14 Jul 2026)1% if redeemed or switched out on or before 60 days from the date of allotment; Nil thereafter
Bandhan Aggressive Hybrid Fund15.6%Rs. 2,021 crore0.91%Rs. 31.21 (Direct, 24 Jun 2026)1% on units in excess of 10% of investment if redeemed within 12 months; nil after 12 months

Disclaimer: Data is based on the latest publicly available information from the respective AMCs and other reliable financial sources as of July 2026. NAVs, AUM, expense ratios, returns, and exit load provisions are subject to change. Please verify the latest scheme details on the respective AMC website before investing.

What should you consider before investing?

Choosing an aggressive hybrid mutual fund involves more than looking at recent returns. Consider the following factors before making an investment decision.

  • Expense ratio: Lower expense ratios can help improve long-term returns because fewer costs are deducted from the fund.
  • Assets under management (AUM): A larger AUM may indicate investor confidence, although it should not be the only deciding factor.
  • Fund manager's track record: Look for consistent performance across different market cycles instead of focusing only on recent returns.
  • Portfolio allocation: Check whether the fund's equity allocation matches your risk tolerance and investment goals.
  • Exit load: Many aggressive hybrid funds charge an exit load of around 1% if units are redeemed within 12 months. Review the scheme documents before investing.

Who should invest in aggressive hybrid mutual funds?

Aggressive hybrid mutual funds may be suitable if you are looking for long-term capital growth while reducing some of the volatility associated with pure equity funds.

These funds may be appropriate for:

  • Investors with a moderate to high risk tolerance.
  • Those planning to stay invested for 3–5 years or longer.
  • First-time equity investors who prefer some stability through debt investments.
  • Investors seeking potentially higher returns than traditional fixed-income products while accepting market-linked risk.
  • Those building a diversified core portfolio using a single hybrid fund.

What is the taxation on aggressive hybrid mutual funds in 2026?

Aggressive hybrid mutual funds are generally treated as equity-oriented mutual funds because they invest at least 65% of their assets in equities. Their taxation depends on how long you hold your investment.

Holding periodTax treatment
Less than 1 yearShort-Term Capital Gains (STCG) taxed at 20%
More than 1 yearLong-Term Capital Gains (LTCG) are taxed at 12.5% on gains exceeding Rs. 1.25 lakh in a financial year

Note: Tax rates are based on the Finance Act, 2024, and may change. Consider consulting a tax professional for advice specific to your financial situation.



Conclusion

Aggressive hybrid mutual funds combine equity and debt investments to balance growth potential with relatively lower volatility. Comparing factors such as 3-year CAGR, expense ratio, AUM, and exit load can help you shortlist funds that align with your investment goals.

Before investing, review the scheme documents, understand the fund's risk level using the SEBI Riskometer, and ensure the investment matches your financial objectives

Frequently asked questions

Which aggressive hybrid fund gave the highest 3-year return in 2026?

As of July 2026, Bank of India Mid & Small Cap Equity & Debt Fund delivered the highest 3-year CAGR of 20.3%. This was around 6 percentage points higher than the aggressive hybrid category average of 14.3%.

 

Aggressive hybrid funds carry moderate to high risk because they invest 65–80% in equities. The debt allocation helps cushion market volatility, making them generally less volatile than pure equity funds but riskier than debt funds.

 

The minimum investment depends on the AMC and scheme. Many aggressive hybrid funds allow SIPs from Rs. 500 per month, while lump sum investments typically start between Rs. 1,000 and Rs. 5,000. On the Bajaj Broking website, you can explore eligible schemes and investment options.

 

Aggressive hybrid funds are generally taxed as equity-oriented funds. Gains from investments held for less than one year are taxed at 20%, while gains from investments held for more than one year are taxed at 12.5% on gains exceeding Rs. 1.25 lakh in a financial year.

 

Aggressive hybrid funds maintain a relatively fixed 65–80% equity allocation. Balanced advantage funds adjust their equity and debt allocation dynamically based on market conditions and the fund manager's investment strategy.

 

A minimum investment horizon of 3–5 years is generally recommended. Staying invested for 5–7 years may help you benefit from long-term compounding while allowing the equity portion to recover from short-term market fluctuations.

 

Aggressive hybrid mutual funds with high returns combine substantial equity exposure with debt investments. Compare 3-year CAGR, expense ratio, AUM, portfolio quality, and the fund manager's track record instead of selecting a fund based only on recent returns.

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