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Alternate Investment Fund
Explore diverse investment horizons with AIFs
Decoding AIFs
Diverse AIF options for you
Hedge Funds: These funds combine investor capital and diverse strategies like long/short equity, global macro, event-driven, or relative value to generate positive returns, regardless of market conditions. Hedge funds often offer unique opportunities, though they might have higher fees and less regulation compared to traditional funds.
Private Equity Funds: Invest in privately held companies with the goal of obtaining a significant ownership stake. These funds aim to enhance company performance, selling their stake for future profits. Private equity funds require a longer investment horizon and might involve more active management.
Venture Capital Funds: Focus on early-stage or high-growth companies with immense potential. Venture capital funds provide capital and expertise to aid growth, especially in innovative startups. While they carry higher risk, they also offer the chance for substantial returns.
Real Estate Funds: Invest in various real estate properties, including residential, commercial, and industrial. These funds offer real estate exposure without direct ownership, generating income through rental yields and capital appreciation.
Commodity Funds: Invest in physical commodities like gold, oil, and agricultural products. These funds offer exposure to commodity price movements and might use derivatives like futures contracts for risk management.
Delving into AIF Categories
Parameter | Category 1 | Category 2 | Category 3 |
Scope / Investment Avenues | Ventures or start-ups, social ventures, SME infrastructure, or other sectors | Private equity funds, debt funds, and other funds and investments that are not classified as Category 1 or 3. | Diverse or complex trading strategies; may use leverage or derivatives for investments |
Examples | VC funds, SME Funds, Social Venture Funds, Infra Funds, Angel Funds | PE Funds, Debt Funds, RE Funds, Fund of Funds, | Hedge Funds, Long / Short Funds, Equity and/or C&C Funds |
Minimum Investment | Depends on AIF | INR 1 Cr | INR 1 Cr |
AIFs vs. Portfolio Management Services (PMS): Unveiling the Distinctions
Parameter | PMS | AIF |
Definition | Pooled capital from multiple investors get invested in alternative asset class/strategies | Invested in direct equities |
Structure | As Trusts and/or Limited Liability Partnerships (LLPs) | Discretionary or Non-discretionary direct investment in listed stocks |
Min Investment | INR 50 Lakhs | INR 1 Cr |