Hybrid funds can be a panacea for market volatility but there's a catch

Investors should, however, be prepared for the fact that lower equity exposure will mean lower returns than from a pure equity fund

With the equity markets turning volatile, fund houses are currently hawking hybrid schemes as an antidote to market volatility. For investors who have a financial advisor, an appropriate mix of equity, debt and gold funds will prove to be a more flexible option. But those who don’t have an advisor, and are not accomplished DIY (do-it-yourself) investors, may opt for hybrid funds.

There may be no respite from volatility in the near future, making these conditions ideal for investing in hybrid funds. “The Nifty has corrected from the peak level of 11,738 in August, but the markets are not yet cheap.