Equity, debt and hybrid
What shares, bonds and a mix of the two are, and what moves the price of each.
This explains how things work. It is not advice about what to buy, sell or hold.
Equity funds
An equity fund invests mostly in shares of companies. Its value follows those companies' prospects and the market's mood, so it can move a lot from year to year, in both directions. Equity funds aim at growth in the value of the money over the medium to long term rather than at a regular income.
Debt funds
A debt fund lends money, by holding bonds, debentures, government securities and money market instruments. Its NAV moves with interest rates: when rates fall, the prices of existing bonds tend to rise, and the reverse when rates rise. Gilt funds hold mostly government securities, which carry no default risk but still move with rates; liquid and money market funds hold very short-term paper, whose prices move least.
Hybrid funds
A hybrid fund holds both shares and debt, in proportions its category sets. SEBI's 2017 rules define the categories by how much is in shares: a conservative hybrid fund held mostly debt with a smaller part in shares, while an aggressive hybrid fund held mostly shares. Holding both means the NAV usually swings less than a pure equity fund's.
Seeing the mix on this site
Every fund page shows the fund's Asset mix from its latest disclosure, and, for the share part, its Sectors and the split between large, mid and small companies. A fund's name and category say what it is meant to hold; the disclosure shows what it actually held on that date.
Sources
- SEBI www.sebi.gov.in/sebi_data/faqfiles/sep-2024/1727242783639.pdf checked 02 Oct 2026
- SEBI www.sebi.gov.in/sebi_data/attachdocs/oct-2017/1509103633344.pdf checked 02 Oct 2026
- Zerodha Varsity zerodha.com/varsity/chapter/asset-allocation-an-introduction/ checked 02 Oct 2026