As investors opt to invest more in equity funds, here is a hybrid fund that outperformed all equity funds in terms of returns. SBI Magnum Children’s Benefit Fund – Investment Plan (Direct Plan) has emerged as one of the most unexpected success stories in the mutual fund sector.
Five-Year Performance
Over the last five years, the fund has recorded a compound annual growth rate (CAGR) of 32.61 per cent. CAGR is a way of measuring how much an investment grows every year on average over a period of time. As in, if someone had invested 1 lakh rupees five years ago, that investment would now be worth 4.10 lakh rupees.
The fund has also shown strong results through systematic investment plans (SIPs). A monthly SIP of 10,000 rupees started five years ago would have grown into 10.77 lakh rupees today, which translates into a 24.13 per cent CAGR. For a hybrid fund, which usually combines stocks (equity) and bonds (debt), these numbers are considered amazing.
Fund Background and Strategy
The SBI Magnum Children’s Benefit Fund was launched on 29 September 2020. Its original purpose was to help parents planning financial security for their children. However, because of its strong performance, it has garnered a wider group of investors longing for high returns.
The fund follows an aggressive hybrid strategy, with a key focus on equity. Since its launch, it has delivered a 35.19 per cent return, higher than many similar funds, tracking the CRISIL Hybrid 35+65 Aggressive Index, a benchmark used to measure the performance of funds with similar strategies. The fund also carries a very high-risk rating.
As of 30 November 2025, the fund manages 5,053 crore rupees in assets with a lesser expense ratio of 0.82 per cent. The expense ratio is the fee charged by the fund manager and a lower ratio ensures more of the returns go to investors.
Risk and Return Ratios
Although the fund takes higher risks, its performance shows efficient management. Several measures have been applied to judge the risk – reward balance:
– Mean return (average return over time): 23.73 percent – This is very significant as far as a hybrid fund is concerned
– Standard deviation (showing the level of ups and down): 12.92 per cent – Shows moderate ups and downs. Moderately acceptable.
– Sharpe ratio (shows how much return is earned compared to the risk taken; higher is better):1.35-above 1 is strong, meaning returns justify the risk.
Sortino ratio (similar to the Sharpe ratio but focuses only on downside risk; again, higher is better): 1.84 – Above 1.5 is excellent, showing losses are managed well.
Beta (measures how volatile the fund is compared to the overall market; less than 1 means slightly less volatile) :0.93 -slightly less volatile than the market.
Alpha (Fund’s performance compared to its benchmark. A positive number denotes its outperformance): 10.55 – Very high positive number, showing robust outperformance.
These figures indicate that the fund is delivering high returns and managing risks effectively.
Sector Allocation and Portfolio
One reason for the fund’s success is its aggressive sector allocation. Unlike most hybrid funds that remain conservative, this fund has invested heavily in certain industries:
– Consumer Discretionary: 29.54 percent (compared to 9.13 percent category average)
– Financials: 17.41 per cent
– Materials: 9.73 per cent
– Consumer Staples: 7.48 per cent
– Industrials: 7 percent
The fund’s top stock holdings include:
-Hatsun Agro: 5.20 percent.
-Muthoot Finance: 5.19 percent.
– Thangamayil Jewellery – 4.78 per cent
– State Bank of India (SBI) – 4.07 per cent
– Privi Speciality Chemicals – 3.82 per cent
This mix of consumer brands, financial leaders, and niche chemical companies has helped the fund generate strong returns, which are above what the market benchmark would normally deliver.